Newly elected President Nicolas Sarkozy good for French property development

A new political era begins for France as it elects right-wing Nicolas Sarkozy as its head of state. Property development in France along with energy, environment, property development, supermarkets and insurers are just some of the sectors that could see impact from Mr Sarkozy’s reform plans according to Alain Bokobza, head of European equity strategy at Société Générale quoted in the FT. Mr Bokobza believes insurers could also suffer, as Mr Sarkozy has promised to scrap inheritance tax for all except the richest negatively affecting sales of life insurance, often bought as protection against tax on inheritance. On a positive not one of France’s largest construction and communications conglomerate, Bouygues, saw its shares rise more than 4 per cent.

Economists have greeted Mr Sarkozy’s election with enthusiasm, in hope of sweeping plans which include tax cuts, labour market reform and debt-reduction. Sarkozy plans to drive growth by rewarding effort through incentives to encourage overtime, reforming the benefits system by forcing the unemployed to accept work pledging to reduce it from 8.3% to below 5% by 2012. In addition to scrapping public sector pension’s privileges, Sarkozy aims to foster competition by creating jobs and liberalising employment laws in attempt to mimic market reforms which most EU countries undertook during the nineties but have failed time and again in France. Key Policies include:

Following his inauguration on 16 May Nicolas Sarkozy’s priority will be to form a new cabinet in good time to be well prepared for the G8 summit in Germany from June 6-8 which will give the world a better indication as to President Sarkozy French foreign policy plans. Reforming France to face the challenges of the 21st century is at the top of his agenda.

The result of the French election race on the whole has been widely welcomed internationally with the US, EU, China and Japan offering congratulations to Mr Sarkozy, with Tony Blair congratulating Nicolas Sarkozy on Downing street’s a la mode You Tube channel. Turkish Prime Minister, Recep Tayyip Erdogan, however remained cautious, saying he hoped Mr Sarkozy would review his opposition to Turkey joining the EU.

France’s new president has not arrived without scandal and the curse of corruption and French presidents seems to have struck Sarkozy when back in March, a newspaper alleged Nicolas benefited from a hefty discount on an 876,000€ luxury apartment during his time as Mayor of Paris’ richest suburb Neilly which he later flipped on for a tidy 2 million euros. President Sarkozy denied the allegations branding them part of a dirty tricks campaign. Currently renting Sarokozy recently revealed if he won the lottery he would buy a house, as his good fortune would have it, I guess he has no need now!