Bank of France reforms launched

EDMOND ALPHANDERY, the French economy minister, yesterday presented his proposals for reform of the Bank of France, a project that is already running into opposition, to the finance commission of the lower house of parliament.

Mr Alphandery is in charge of making the French central bank independent in conformity with the monetary provisions of the Maastricht treaty on European union.

Although central banks do not have to become independent until 1999, the recently elected conservative French government favours changing the bank's statutes by the end of this year to give it time to settle down well ahead of monetary union.

Mr Alphandery's appearance before the finance commission of the National Assembly was the first move in the legislative process. It will be followed by a session before the same commission of the Senate and then by a full parliamentary debate, at present scheduled for the end of the month.

Opposition to the project comes mainly from the anti-Maastricht politicians who campaigned against the treaty, approved by tiny margin in last year's referendum. They include Jean-Pierre Chevenement, the former Socialist defence minister, and Philippe Seguin, the Gaullist president of the National Assembly. Mr Chevenement has described the move as detrimental to national sovereignty.

While Mr Chevenement may be joined by former colleagues in the Socialist Party, with which he split last month, potentially more dangerous opposition could come from the right.

A question mark hanging over the bank's future, due to the use of different words by politicians, is whether it will be truly 'independent' or just 'autonomous'. Mr Alphandery's contribution to the debate has been to say that monetary policy, entrusted to a monetary policy council, would be 'independent' while its other activities, under an administrative council, would be 'autonomous'.