Develop your critical thinking :
Question : Why can the decision of privatizing la « Francaise des Jeux » be controversatial ? On
what are the pro and cons of the decision?
-> Controversal ?
- Pro : permit to the state to earn money
- French governement (initiative of Economy Minister Bruno le Maire) sell it’s share (from 72 percent to about 20 percent) in order to raise over a billion euros ($1.1 billion)
- the state will benefit from a yearly public contribution of about 3.5 billion euros, and 380 million euros in payment due for the FDJ’s 25-year license.
- Not only the case of FDJ -> government privetized airports company, telecommunications company, national bank and energy company (which permit to earn a 10-billion euro fund to kickstart technological innovation.)
- Cons :
- The move to offload a rare money-making state enterprise has been criticised by opposition parties as tantamount to selling off “the family jewels”.
- The existing shares will see their nominal value divided by 955 ahead of listing, to increase their number to 191 million and make them cheaper. -> closer to dozens of euros than a hundred (Bad ‘cause 13.4 percent of the shares are owned by veterans organizations ‘cause were meant to help soldiers wounded and disfigured in World War I at it’s creation , and help farmers going through tough times)
- So, by selling state share, the gamblers could be more vulnerable to corporate greed (now it’s profit-driven so they will encourage the spending of their clients)
=> to address his problem, the government has created National Authority of games so as to regulate gambling and prevent addiction (the state still hold a certain degree of influence over the company through a government concilier to control the decisions of directors if there are problematics)
= FDJ use a notice of approval of the State to the leaders, which may be withdrawn at any time if the state no longer approves of FDJ decisions,
= The state also have the power to block any capital increase of more than 10% of shares.