French state to absorb 35bln euros of rail company's debts

In a fresh round of negotiations on Friday between the French government and rail union officials leading rolling strikes in protest at planned reforms to shakeup the publicly-owned SNCF railways company, including the introduction of private competition, Prime Minister Edouard Philippe has proposed that the state will absorb most of the company's debts of 47 billion euros in return for an end to the dispute.

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Emmanuel Macron’s government, hoping to end a protracted French train strike, offered on Friday to soak up most of the national SNCF rail company’s debt as long as modernisation plans to make the railways more cost-effective are implemented, reports Euronews.

The offer to absorb the bulk of SNCF debt — 35 billion euros out of a total 47 billion euros  — goes some way to meeting the demands of more moderate unions involved in a strike that has halved train service for much of the past two months.

The offer was announced by the unions after meeting Prime Minister Edouard Philippe, who hopes moderate unions involved, primarily the CFDT and Unsa unions, will now pull out of the industrial action.

The Unsa union said the debt relief offer showed it was worth negotiating with the government but the hardline CGT union’s chief rail representative, Laurent Brun, said “the conflict goes on”.

The showdown is seen as a test of Macron’s determination to push ahead with a wider agenda of economic reform in addition to an SNCF shake-up that would be the biggest since nationalisation of the railways in 1937.

The reform his government has proposed seeks to reduce costs and end hiring of rail staff – they currently number 150,000 – on more protective contracts than exist in other sectors.

Opinion polls show a majority of voters back the government’s railway reform plan and oppose the strike.

Read more of this Reuters report published by Euronews.

 

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