The Strategist

France is counting losses from the Yellow Jackets

07/22/2019 - 12:07

The Saturday’s rally of the “Yellow Vests” turned out to be numerically insignificant and gathered 10.3 thousand people throughout France. The center of the protests was the city of Montpellier, where the protesters and their fellow antiglobalists staged a rally.

The events in Montpellier will add to the government’s bill to the demonstrators. The report “The Effect of Yellow Vests”, made under the leadership of Roland Leskure, Chairman of the Parliamentary Economic Commission, describes the damage that the destructive activity of the Yellow Vests caused to the French economy.

The overall damage to the economy, recorded in the last trimester of 2018, is estimated at 0.1% of GDP. This is less than expected. Economy Minister Bruno Le Maire previously estimated the damage at 0.2% of GDP, or € 4 billion.

According to experts, this is a relatively small loss. However, the protests, though weakened, have not ceased yet, and secondly, indirect losses should be taken into account. The report states that trade and services companies located in the center of the cities affected by the demonstrations recorded a 20–30% drop in turnover. This fall can be explained by the inability to trade and by the need to repair everything that was broken during the rallies.

Central streets, which normally attract tourists and townspeople, turned to be "dangerous" on weekends. The best example is the Champs-Elysées in Paris. Only curious and the demonstrators themselves came there at the peak of the rallies. Shops and restaurants that dared to stay open or didn’t protect their windows often became victims. As a result, the loss of hotels and restaurants is estimated at € 850 million.

In their fight with the state, the protesters blocked roads, seized toll payment points and destroyed red-light speed cameras (the 80 km/h limit on country roads was one of the reasons for the initial protest). In particular, the protesters destroyed 2410 radar cameras and damaged 577 items.

The commission estimated the cost of restoring road structures to be € 71 million. More than € 46 million was spent on overtime for police officers and firefighters who were deprived of their days off during the 35 Saturdays of 2018 and 2019. This sum also includes treatment of victims during police operations. Insurance payments (about € 217–220 million) were also added. Speaking about the data collected by the commission, Roland Leskure expressed regret that the actions of the Yellow Vests affected “those people whose protection they claimed”.

The report does not take into account the € 10 billion that President Emmanuel Macron promised to spend on increasing the purchasing power of the French in December 2018. His decision was criticized, the proportion of compensation payments per person was questioned. But the promise was fulfilled, and residents of the country received a tax-free pay increase last year. As experts say, these billions, injected into consumption, largely helped the French economy smooth the blow.


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