The French government will take some of the railways debt | Finance and Markets

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In attempt to end the strike that has been going on since April, the France’s Prime Minister Edouard Philippe has announced that the state will take “a significant part of the debt” of SNCF, but without summing it. Responding to the unions, all protests are continuing, but they are open to talks if the government proves its will in the weeks ahead before the Rail Reform Act joins the Senate on May 29th.
The state-owned railway operator SNCF has debt of 46.6 billion EUR and is expected to cross the 50 billion EUR in 2020.
The decision was announced after a trade union meeting with the prime minister in Paris on May 7th.
After the meeting, the secretary general of the railways union said the exact amount of the debt was not mentioned, but that the write-off would become “gradual” from January 1, 2020 until 2022.
The French Prime Minister Edouard Philippe said the draft law on reform “will not change much”. A new meeting of government and trade unions may take place on May 24-25.
The French railways reform, which is the biggest since their nationalization in the 1930s, has become a test of President Emmanuel Macron’s decision to push reforms in the first of his five years.
The President Macron promised to implement the reform of the indebted SNCF before the opening of the rail industry for competition in 2020. He proposed the abolition of the special status of railway workers, which allows some of them to retire at the age of 52. Changes will only apply to new employees. The reform also provides for SNCF to become public property instead of a state.
While the trains were striking, the French tried out all the means of travel – from a shared BlaBlaCar trip, where car demand jumped six times to buses such as FlixBus intercity lines, where online subscriptions increased by 60%.
While Prime Minister Edouard Philippe and the unions gave a press conference at the headquarters of the government in Paris, at Montparnasse station in Paris, railroaders and police participated in clashes that led to the use of tear gas. The unions supported by students tried to block the Paris station as a protest against the reforms.