French minister slams German policy

France’s Social Economy Minister Benoit Hamon has accused Germany of trying to take an unfair advantage by keeping pay artificially low, urging the country to raise wages to ensure fairer competition.

“I want Germany to have a social policy where competitiveness doesn’t rely on jobs paying 400 euros [£336; $534] a month,” Hamon said on Thursday.

The demand comes as German Chancellor Angela Merkel has urged France to decrease wages to become more competitive.

However, Hamon stated that he was tired of hearing calls for labor reform when “some countries in Europe are getting around employment directives and underpaying their workers.”

The high cost of French labor causes its products to become more expensive, but labor reform in Germany means that the country’s products have been getting cheaper.

Hamon also said that Germany’s government is not willing to lose an unfair competitive advantage, adding, “I want Germany not to base its agricultural economy on salaries of seven euros an hour. That’s what I want from the next German government.”

“I want it to play fair with an economic model that isn’t based on a competition of who can pay workers the least,” he said.

To stimulate the growth, France is in need of exporting its products and Germany is the biggest export market for the country. Statistics show that in recent years France has imported far more goods from other countries than it has exported.

According to a recent study about competitiveness rankings of the Davos World Economic Forum, France fell to 23rd spot, 12 lower than its position in 2005. Over the same period, Germany reached from 6th to 4th place.