EXCLUSIVE / Arnaud Montebourg, the firebrand French Industry Minister, launched a scathing attack on the EU's "stupid" competition and state aid rules, claiming they are "counter-productive" because they prevent the creation of Europe-wide industrial champions. In an interview with euractiv.fr, he also spoke in favour of a weaker euro to support exports and restart industry.
Montebourg, whose ministry for "industrial revival" mixes industry, SMEs, the digital economy and innovation, told euractiv.fr that “European rules are the rules of the old world".
"We need to overcome these obsolete rules as they don’t correspond to a globalised economy," he said.
According to him, the EU's state aid and competition rules have contributed to the “balkanisation” of companies by preventing the emergence of Europe-wide industrial champions.
"This is where there is a real problem. Just look at the market capitalisation of European telecoms groups compared to the US Verizon. Europe organised the balkanisation of its companies by chasing down state aid. It was a stupid and counter-productive policy."
By contrast, he said China and the US do not hesitate to support their own enteprises and spoke out in favour of state intervention on economic matters, recalling that governments had injected €500 billion into the banking sector during the eurozone crisis, creating "mountains of debt" while industry "got zero".
The euro is too expensive
In the meantime, Montebourg said the EU has applied the wrong recipe to emerge from the crisis. "The fiscal and monetary policies of the European Commission are catastrophic. Raising taxes and waiting for the crisis to go away, it never worked," he claimed.
Instead, the French Minister argued that monetary policy must by used as a lever to restart economic activity in Europe. "The European currency is too strong, it is too expensive. We need to change monetary policy urgently," he said, adding: "there is no mystery, you have to practice a more flexible monetary policy and inject money into the economy."
"This is not me saying it, it is a great economist, Joseph Stiglitz: no economy has ever emerged from a crisis without the use of monetary policy. Today we see Japan, the United States going out of the crisis gradually, and in Europe there is no growth!"
The Minister also reminded the Commission that it needs to take its time on the trade and investment negotiations that are underway with the US. “If the agreement is rushed, the citizens’ anger will show at the next EU elections," he warned.
His advice for the election of the next EU leaders was to go for a political approach rather than supporting a French candidate at all costs: “We need to support a politically committed team that will be ready to help Europe’s recovery by using monetary and budgetary means."
>> Read the full interview with Arnaud Montebourg (in French)