The French government on Friday launched a frantic and desperate attempt at damage limitation over the decision not, after all, to hand Thomson Multimedia SA over to Daewoo Electronics Co. The Foreign Ministry issued an unusual statement aimed at soothing extremely raw South Korean feelings over the decision, saying that France and South Korea enjoyed relations of respect, partnership and trust. The government tried to make out that the decision to abandon the sale was all down to the Privatization Commission. But anyone who knows anything of governance knows that of all the European countries, France is the one where every arm of the state operates in concert, and any decision of a body like the Privatization Commission is really a decision of the government and the Elysee. Meantime, Reuter was reporting from Paris that French state agencies met on Friday to rubber stamp the $2.09bn capital injection of state aid in Thomson SA, as the government reviewed options for reviving its sale into the private sector. Making it clear that the people that would have become Daewoo Electronics Co employees were implacably opposed to the takeover, Thomson trades unions, with support of many other labor groups, were planning a big demonstration in Paris to demand the total cancelation of the group’s privatization. And the Communist-led CGT union said on Friday that the government should now also suspend planned privatization of France Telecom next spring. Also involved in damage limitation was Finance Minister Jean Arthuis, who told the Financial Times that France still wants foreign investment despite suspending the privatization.
