The decision, which will be fully implemented just before campaigning begins for the next presidential election in 2002, in effect closes several months of frenzied discussion in France about the value of conscription and pre-empts calls for a referendum on the question. Charles Millon, the defence minister, despite having been exempted from military service, is understood to be somewhat equivocal about the changes.
Details of the voluntary civilian service are to be decided after widespread discussion. Mr Chirac said he had ruled making such service compulsory.
Mr Chirac set his decision in favour of a fully professional army in the framework of an overall strategy for modernising the whole of the French defence sector now that the threat from the east no longer existed. He said the aim was to give France a "more efficient, more modern and less costly army" which would be "projected outwards" and capable of immediately deploying 50-60,000 men wherever they were needed.
He referred to France's chastening experience in the Gulf war when France had "difficulties in meeting our responsibilities". Its shortage of air transport capacity and inexperience of working with other Nato forces have been seen in France as a major handicap.
Mr Chirac also stressed the need for France's arms industry, which was "among the best, if not the best" in the world, to become more competitive in the global marketplace. French arms sales abroad have plunged 60 per cent in the past three years, it emerged from the economics ministry yesterday, costing 10,000 jobs a year. While announcing the slowing of some procurement programmes, Mr Chirac insisted he was generally optimistic and believed the world was "on the eve of a big economic recovery", caused in part by an upsurge of demand from the growing economies of Asia and Latin America.
He none the less undertook to oversee personally assistance programmes for towns and regions whose economies could be devastated by the planned army and defence industry cuts.
Legislation enshrining changes in the structure of the defence industries and the ending of conscription is to be laid before parliament by June at the latest. The French President paid especial attention in his interview to reassuring Germany, which had made known its misgivings about changes to the French defence structure, including France's possible withdrawal from the mainly French-German Eurocorps. Mr Chirac said there was no question of withdrawing from Eurocorps and said all joint defence industry programmes would be honoured.
As an apparent token of good faith, he also announced that in addition to scrapping its land-based nuclear deterrent - to concentrate on air- launched and sea-launched nuclear missiles - France would dismantle its existing short-range nuclear missiles. These, he said, had been a cause of concern to Germany because their range meant they could be targeted at Germany, but no further.
The switch to a professional army will reduce the size of the armed forces as a whole (including the gendarme service) from more than 500,000 to fewer than 350,000. All the service jobs to be lost relate to conscripts, and another 40,000 men will need to be recruited once conscription ends. According to a parliamentary report published yesterday the change will save around 14bn francs (pounds 9.3bn) a year.
Even so, the changes represent a severe challenge for a president and a government that have placed cutting unemployment, especially youth unemployment, at the centre of their concerns.
Slimming and restructuring the defence industries will cost at least the current 10,000 jobs a year for the next four years.
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