The Montebourg Method: French minister gives lesson in state intervention over Alstom deal

An executive at Alstom, the French train and turbine maker that has been the object of a lengthy and high-profile bidding war by rival foreign businesses ending in a deal with American firm General Electric, is quite candid. “When I saw [economy minister Arnaud] Montebourg take charge of the case, I told myself we were heading for disaster. But on Friday [June 20th] when I discovered what the agreement was, I conceded that he'd done a good job,” admits the executive, who does not hide his preference for liberal economic policies. “First of all, the good news is that Alstom will not be in partnership with [German firm] Siemens, which would have led to a jobs massacre in the group, but rather with GE. And then it has to be said that the agreement that Montebourg has obtained is better than the outright sale planned at the beginning, even if some aspects remain to be clarified.”

It has certainly been an important episode for Montebourg. Having been criticised for his failure over the steelworks at Florange in north-east France – which he wanted to nationalise – mocked for his dyed-in-the-wool interventionism and described by his critics as the minister for bragging and tilting at windmills, Arnaud Montebourg has just made a crucial political point with his handling of the Alstom case. The embarrassed reaction from the Right, who expected him to get his comeuppance over this emblematic case that was so dear to the heart of former president Nicolas Sarkozy, and the irritation at an Elysée eager to let it be known it was the president's office that made the final decision, imposing the choice of GE on Arnaud Montebourg who himself preferred the rival joint bid by Siemens and Japanese firm Mitsubishi, show the extent to which the minister's political lesson has caused annoyance. Montebourg's success in brokering the deal has wider implications than just his own political fortunes. With the support of prime minister Manuel Valls, and faced with a wavering Elysée, the economy minister has shown that there is still place for an industrial policy and that the state need not always remain powerless.