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French fear US
'payback'
By Julio Godoy
PARIS - French businesses are beginning to fear
that they will pay a high price for their government's
opposition to the United States' war plans in Iraq.
Managers of businesses from luxury goods to
food, perfumery, fashion, defense and oil are becoming
increasingly anxious about a possible US boycott of
French goods. Worries have risen since the US media
launched a campaign mid-February against the diplomatic
position taken by President Jacques Chirac.
The
US the biggest commercial partner of France, with French
exports to the US topping some US$30 billion last year.
Chirac has tried to calm fears of a US boycott. "I know
the United States very well, it is a liberal country
interested in commerce," Chirac said. "A boycott would
be counterproductive."
Not everyone feels
reassured. Fears seem greatest within the oil industry.
Iraq is regarded as the most attractive place to produce
oil, with vast reserves and low production costs. "No
mineral has better economics than oil and no country has
better oil economics than Iraq," says a spokesman for
the Ireland-based Petrel Resources.
Only 2,000
oil wells have been drilled in Iraq compared to a
million in Texas. Eight in every 10 wells drilled in
Iraq have struck oil; in Saudi Arabia the success rate
is less than half.
The French oil giant
TotalFinaElf signed exclusive contracts with Iraqi
authorities in 1997 after the introduction of the
oil-for-food scheme. TotalFinaElf agreed to develop the
Nahr Omar oil field in southern Iraq which holds an
estimated 10 billion barrels of oil - about a third of
US reserves. TotalFinaElf has also been eyeing oil
fields at Bin-Umar and Majnoun around Basra in southern
Iraq. These two oil fields have from five to eight
billion barrels, Total has estimated.
"The Gulf
war 12 years ago interrupted our dealings with Iraq,"
says Christophe de Margerie, general director of
production at TotalFinaElf. "We began discussions with
the Iraqi authorities again in 1992, and worked on
contracts that would take effect as soon as the UN
embargo would be lifted."
There are fears now
that these contracts would be cancelled following a war,
and production rights will go to US and British
enterprises. Total hopes the contracts will stand. "We
trust the legal basis of our dealings in Iraq," says De
Margerie from TotalFinaElf. "Unless Iraq becomes a
protectorate, Iraqis themselves would have something to
say on the future of their country's resources."
The very fear of a boycott has been damaging. A
newspaper reported that the catering company Sodexho
Alliance has lost a major contract with the US military.
Sodexho denied the report, but the company's shares fell
7.4 percent. Other managers fear that an unofficial
boycott of French goods could already be under way. For
example, the web site of Fromage, which exports cheese
to the US, has been bombarded with hate mail against the
French position on Iraq.
Conservative media in
both the US and Britain have attacked France. The
tabloid New York Post called the French "cheese-eating
surrender monkeys". The otherwise solemn Wall Street
Journal called Chirac a "Jean d'Arc with a bald head",
and "a pygmy", and called foreign minister Dominique de
Villepin "an oily rat".
Many French firms depend
heavily on the US market. As much as 30 percent of the
turnover of the cosmetics firm L'Oreal comes from the
US. French wine has massive sales in North America. The
US also constitutes 36 percent of the world market in
cognac.
"We are all concerned, but we are trying
not to dramatize the situation," says Alain Philippe,
director of the National Bureau of Cognac. "We hope that
the present French phobia is only superficial and that
it will go away in a couple of weeks."
Jacques
Berthomeau, ministerial reporter on export of French
wines, says that US customers are sociologically immune
to the present campaign. "We sell our goods to a
high-income, high-educated population, which is a
priori less sensitive to populist watchwords," he
says. But just a small loss of market share can mean
heavy losses for exporters.
The tourism business
is also worried. About 3 million US visitors went to
France last year, 18 percent less than in 2001. "The
anti-French feeling is not showing up by way of fewer
visitors right now, but it's certain that the image of
our country conveyed by newspapers doesn't encourage
anyone to come here," says Jean-Marc Janaillac,
president of the Paris Tourism office.
(Inter
Press Service)
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