| PARIS, Sept 24
PARIS, Sept 24 France's Socialist government
will let gas-rich Qatar invest millions of euros to foster
business creation in depressed suburbs, a move critics say is an
admission of defeat and grants far too much influence to the
Plans for a 50 million euro fund to stimulate economic
activity in urban suburbs proved divisive when they were first
floated last year, prompting former president Nicolas Sarkozy to
put them on hold until after the May election.
Now President Francois Hollande's government, under pressure
to create jobs in suburbs where unemployment sometimes exceeds
40 percent, plans to unblock the funds thanks to a compromise it
hopes will soothe concerns from both left- and right-wing
A source close to Industry Minister Arnaud Montebourg said
the plan was for the government and French companies to match or
exceed Qatar's investment of 50 million euros ($65 million), for
a total of at least 100 million.
"Qatar is a friend to France. This will be a mixed
Franco-Qatari fund; Qatar won't have a majority," the source
said, adding that final details and a timetable still had to be
Business ties between France and Qatar have deepened in the
past five years as the euro zone's No. 2 economy has overcome
instincts for economic patriotism, welcoming investment in areas
from sports to real estate and infrastructure.
There was little backlash when Qatar bought minority stakes
in infrastructure firm Veolia and builder Vinci
, while sports fans cheered the purchase of football
club Paris St. Germain by its sovereign wealth fund last year.
The suburban funds are to be aimed at providing financing
for first-time entrepreneurs looking to set up businesses.
The loudest criticism to the idea has come from far-right
leader Marine Le Pen, who said Qatar -- a tiny state with Sharia
law -- was only investing in immigrant-heavy suburbs to spread
Islamic ideas among Muslim youths.
"They are investing massively in the suburbs because of the
large proportion of Muslims who live there," Le Pen told RTL
radio. "It's suspicious because we're letting a foreign country
cherry-pick its investments based on the religion of this or
that segment of the population."
Meanwhile, left-wing commentators argued that France should
be wary of signing deals with a monarchy that shares few of its
ideas about democracy and could be seeking to buy influence due
to France's seat on the United Nations Security Council.
Kamel Hamza, a town hall adviser in the northern Parisian
suburb of La Courneuve, said Qatar had agreed to make the
investment after a group of 10 elected officials from minority
backgrounds visited the Gulf state in November 2011.
"We were disappointed to hear the project had been
sidelined," he told Reuters. "We had entrepreneurs in the
neighbourhood lining up with business plans, ready to go."
"The fact that the government is matching the funds is good
news - it puts a lot of the criticism to rest," he added.
A spokesman at Qatar's embassy in Paris declined to comment.
(Reporting By Nicholas Vinocur)