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French climbdown?

Mark Mardell | 11:03 UK time, Sunday, 1 March 2009

Even before today's summit begins the Commission are claiming victory over the French president and what has been seen as his determination to put French industry before that of other European countries.

The Commission says that the French have promised "the French authorities have undertaken not to implement aid measures to the automotive sector that would contravene the principles of the internal market. In particular, the loan agreements with manufacturers would not contain any condition regarding either the location of their activities or a preference for France-based suppliers".

adds a comment from the competition commissioner Neelie Kroes that it is important to "remove all ambiguity in this case, as Europe must avoid a return to protectionism and its negative consequences for employment in Europe. I am particularly vigilant in this respect."

This may be a question of interpretation. When I was in Paris on Friday French TV was debating on and off all day the suggestion that their president talks too much. It may well be that in this case the rhetoric that angered so many ran ahead of actual measures in the plan. The French Industry Minister, Luc Chatel, who gave the Commission the reassurances it required yesterday, explicitly denied in a Ö÷²¥´óÐã interview (on Thursday morning) that the plan was protectionist:

"Once again, there is nothing protectionist about this plan. It is aimed at companies which make cars on French territory, whatever their nationality. It comes with conditions which have always existed at the heart of the European Union. I was elected mayor: when I asked for economic help from the EU, it always came with obligations. The EU would say 'What investments will you match it with? How many jobs will be created?' and we'd have to accept certain obligations. Our plan for the car industry is directly inspired by this mechanism."

How this will all play out when the prime ministers and presidents are all in the same room we will see in a few hours.

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