the newsmagazine off the chemical world VOLUME 36, NUMBER 24 | JUNE 16, 1958

What Will Happen . . . . . . in the French and European chemical industry with de Gaulle in power? His record shows little to support prediction, but French industry is optimistic

Kryn Taconis-Magnum

Charles de Gaulle: Levered into power by problems more political than eco­nomic, he's something of an enigma to French industry. But chemical shares rose in Paris when he took the reins

I j o w WILL General de Gaulle's com­ing to power affect the chemical indus­try in France and in Europe? The usual answer C&EN got to this question in Europe last week was: "You tell us ." De Gaulle is a military man and the un­solved problems which have brought him to power again are primarily polit­ical and not economic. There isn't much in his past record to show how he will act in this sphere. But the general outlook among businessmen is opti­mistic.

There is a feeling that anything which tends to give France a stable government is bound to be good for the French economy. De Gaulle is re­garded as an isolationist in military matters and in foreign policy. For ex­ample, some think that he might be un­favorable to continuing the cooperation with NATO. However, it is not at all certain that this attitude would extend to economic questions, especially the European Common Market. One prominent German chemical executive says that he feels the recent develop­ments in France will delay the common market about a year, but will not stop it.

By delay, he means delay the time where the gradual changes in tariffs reach a point at which the effect will be noticeable. The French could delay this date by invoking various escape clauses. Even if the recent political upheaval had not occurred, the French might have had to delay some of the Common Market provisions because of financial difficulties. France had a shortage of foreign exchange for some time. A crisis was delayed some months ago by American credits, but

things are again coming to a head. Foreign exchange shortage means, usually, cutting down imports. So if France tends to drag its feet in the coming months over the Common Mar­ket, the blame should not necessarily be placed on de Gaulle. The recurring political and financial crises tend to ob­scure the fact that French industry, and especially the chemical industry, has been doing very well for itself dur­ing the last few years. The production index for chemicals according to the Organization for European Economic Cooperation has grown each year: 1954, 120; 1955, 139; 1956, 151;' first half 19.57, 172.

The Algerian war has meant a huge daily drain on the French economy. Stopping this drain would certainly benefit all concerned, and France most of all. Even if the solution is extreme and Algeria is separated from France, the French chemical industry should not suffer too much directly. Of course, France would lose its newly discovered Sahara petroleum, in which it places great hopes. However, Europe is the natural market for Sahara oil just as it is for Near East production. France would be likely to remain Al­geria's chief economic partner in any case. It is only a short haul across the the Mediterranean to France's rapidly industrializing southern coast.

The new French economic minister, Pinay, is considered a friend of busi­ness. His appointment is thought to re­flect de Gaulle's attitude. The Paris stock exchange has reacted favorably to de Gaulle, arid chemical shares have gone up . B

J U N E 16, 1958 C & E N 23

CHEMICAL· AND ENGINEERING1

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