France is still looking to find its new image. The old look of a socially oriented market economy doesn't work. New liberal economic model isn't widely accepted. The old role of an American ally, but of an independent nuclear power isn't accepted either. The new role of a global counterbalance to Washington although tempting, isn't affordable option for a middle-rank country like France. Like Germany France still looks more to the past than to the future for economic and social inspirations.

Since 1981 France has been a battle ground for at least two competing economic models: the socialist aiming at centralization of the economic activity as much as possible in the hands of the government versus the liberal aiming to decentralize the same activities toward private hands. None of these two opposing models is absolute, i.e. most socialists agree to leave the market determining many aspects of the economic life. On the other hand, many liberals still consider the state as a final arbiter in determining the main economic directions. The struggle between these two main and several secondary streams makes France on the one hand the most unpredictable among the West European countries in terms of economic policy, but on the other hand, paradoxically, the most predictable given that none of the streams can be strong enough to impose one particular model so the result is always a mix of them all. Thus French economy since 1981 is a mix of conflicting ideas and messages sent to the public and to the business. Unlike UK under M. Thatcher and T. Blair, and Spain under F. Gonzales and H. Aznar, France hasn't experienced recently a relatively long period of economic consistency. What one government does is usually undone by the next and done again by those who follow just to be dismantled by their successors.

The reason why French governments try more to undo the job of their predecessors instead of building something new and long lasting is that they turn for inspiration to the past, looking for clues how to solve their current problems. The socialist half of the political spectrum tries to build a socially just society with human political face where the state is the main agent that moderates the inherently unpredictable market forces. The other half of the spectrum, uniting liberals and conservatives, tries to liberate the markets as much as possible with or without the help of a strong state agency. There are dissenting internal factions within each of these two larger groups: there are socialists who despise the state as inherently oppressive and also conservatives who celebrate the state "glory" at each official occasion.

Right now France lives under the right liberal and conservative leadership with more accents being put on the conservative than liberal elements within the right movement. Some of the measures seem reasonable like dismantling the 35-hour work week and some minor social reforms, but the way it's done shows that the positive effects won't be too big to have any substantial effect on the general economic environment. The last two years of the current presidential mandate till 2007 will be spend on consolidating the current political leadership of the President Jacques Chirac and the Prime Minister Jean-Pierre Raffarin instead of trying to push further any social and economic reform. These will be two lost years for France. The best it can hope is to keep its present position in the economic world. Given the world economic dynamics, at least some positions will be lost for good.

On the foreign political front after a brief and highly spectacular try to be a global counterbalance to the United States in 2003, France is again sliding to its usual position of a strong middle-rank state with independent policy but nevertheless accepting the world order dominated by Washington. France can still gain from this world order much more than by trying to destroy it so anyone who expects from Paris to do such a spectacular act of international suicide will be at the end greatly disappointed from eth French reluctance. Stagnation in the domestic policy and tacit accommodation to the world dominated by the Americans, that's what we can expect from the French government in the two years ahead.

France country profile:

• Area: 547,030 sq km
• Population: 60,424,213 (July 2004 est.)
• Population growth rate: 0.39% (2004 est.)
• Total fertility rate: 1.85 children born/woman (2004 est.)
• GDP per capita: purchasing power parity $27,600 (2003 est.)
• Distribution of family income (Gini index): 32.7 (1995)
• Unemployment rate: 10.0% (2005 est.)
• Main trading partners: other EU countries, United States,
• Internet users: 21.9 million (2003)

(Source: CIA - The World Factbook 2005)

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