French Tourism Sector Faces Cancellations over Unrest

Days of violent protests in the wake of the police killing of a 17-year-old have begun to take a toll on France's tourism sector. JEFF PACHOUD / AFP
Days of violent protests in the wake of the police killing of a 17-year-old have begun to take a toll on France's tourism sector. JEFF PACHOUD / AFP
TT

French Tourism Sector Faces Cancellations over Unrest

Days of violent protests in the wake of the police killing of a 17-year-old have begun to take a toll on France's tourism sector. JEFF PACHOUD / AFP
Days of violent protests in the wake of the police killing of a 17-year-old have begun to take a toll on France's tourism sector. JEFF PACHOUD / AFP

Days of violent protests across France after the fatal police shooting of a teenager have started to impact the country's tourism sector, with hotels and restaurants facing cancellations while some have also suffered damage in the unrest.

Since the death of 17-year-old Nahel during a traffic stop in a Paris suburb on Tuesday, "our hotel members have suffered a wave of cancellations of reservations in all the territories affected by the damage and clashes," said chef Thierry Marx, president of the main association for hotel and catering industry employers.

Marx said Friday he was receiving daily alerts from industry professionals who have suffered "attacks, looting and destruction of their businesses, including some restaurants and cafes”, AFP reported.

"Our establishments are intrinsically hospitality venues, and sometimes even refuges and places of help in crisis situations. They must not suffer the consequences of anger that they have not aroused and we condemn these actions," he added.

Marx wants the authorities to do "everything" to guarantee the safety of people in the hotel and catering industry in the world's most popular tourist destination.

The French retail federation (FCD) also called for reinforced police security around stores, said managing director Jacques Creyssel.

The riots "gave rise to real scenes of looting", he said, with "more than a hundred medium and large food or non-food stores vandalized, looted or even burned".

These incidents "are extremely serious and have an extremely heavy cost", according to Creyssel, who said he had asked the economy, interior and trade ministers to act.

The Paris Ile-de-France Chamber of Commerce said it was ensuring its teams were mobilized to "provide the necessary support and technical assistance, particularly in terms of continuing operations, insurance compensation, etc..." for traders and managers of affected companies.

Security concerns

The GHR organization for independent hotels and restaurants in France deplored that "foreign (TV networks) are starting to show images of Paris on fire and blood, which does not correspond to reality".

"Will the violence and riots continue and cause a real wave of cancellations? That's the risk," managing director Franck Trouet told AFP.

"Asian tourists, in particular, who are very concerned about security, may not hesitate to postpone or cancel their trip," he warned.

Didier Arino, managing director of the Protourisme firm said: "Tourists who know us well, like the Belgians or the British, who also have problems themselves in their suburbs, will be able to make sense of things".

But in the end, he said "it's as if we were doing a negative publicity campaign worth several tens of millions of euros for destination France".

The confederation of tobacconists was also indignant at the "looting and ransacking of shops, including 91 tobacconists during these last days of clashes".

"If it continues like this, it can significantly complicate the organization of the Olympic Games, especially since a good part of the events will take place in Seine-Saint-Denis," a disadvantaged area in the north of Paris, said Jean-Francois Rial, president of the Paris Tourist Office.



Trump Treasury Pick Bessent Backs Fed Independence, Dollar, Sanctions on Russian Oil

 Scott Bessent, US President-elect Donald Trump's nominee to be secretary of treasury, looks on as he testifies during a Senate Committee on Finance confirmation hearing on Capitol Hill in Washington, US, January 16, 2025. (Reuters)
Scott Bessent, US President-elect Donald Trump's nominee to be secretary of treasury, looks on as he testifies during a Senate Committee on Finance confirmation hearing on Capitol Hill in Washington, US, January 16, 2025. (Reuters)
TT

Trump Treasury Pick Bessent Backs Fed Independence, Dollar, Sanctions on Russian Oil

 Scott Bessent, US President-elect Donald Trump's nominee to be secretary of treasury, looks on as he testifies during a Senate Committee on Finance confirmation hearing on Capitol Hill in Washington, US, January 16, 2025. (Reuters)
Scott Bessent, US President-elect Donald Trump's nominee to be secretary of treasury, looks on as he testifies during a Senate Committee on Finance confirmation hearing on Capitol Hill in Washington, US, January 16, 2025. (Reuters)

President-elect Donald Trump's pick for Treasury secretary, Scott Bessent, said on Thursday that the dollar should remain the world's reserve currency, the Federal Reserve should stay independent and that he is ready to impose tougher sanctions on Russia's oil sector.

Bessent, testifying at a Senate Finance Committee confirmation hearing, underscored an urgent need to extend Trump's 2017 individual tax cuts, saying that allowing them to expire at the end of this year would unleash a $4 trillion tax hike that could crush the US economy.

"If we do not renew and extend, then we will be facing an economic calamity," Bessent said. "We will see a gigantic middle class tax increase."

Bessent, a hedge fund manager and founder of Key Square Capital Management, voiced support for Trump's plans to impose steep tariffs, saying they would combat unfair trade practices, raise revenues and increase US negotiating leverage, including on non-trade issues.

In prepared remarks he said pro-growth tax, investment, trade and energy policies would usher in a "a new economic golden age" of prosperity.

RUSSIAN OIL SANCTIONS

Bessent said that US sanctions against Russia's oil sector have been too weak, partly because the Biden administration was too concerned about increasing prices at the same time it was constraining US oil output. Increased US oil production would allow for tougher sanctions on Russian oil majors, he said.

"I think if any officials in the Russian Federation are watching this confirmation hearing, they should know that if I'm confirmed, and if President Trump requests as part of his strategy to end the Ukraine war, that I will be 100% on board with taking sanctions up - especially on the Russian oil majors - to levels that would bring the Russian Federation to the table," Bessent said.

He also had harsh words for China, calling it "the most imbalanced, unbalanced economy in the history of the world," one that was trying to export its way out of a "severe recession/depression" and the US could not allow China to flood US or world markets with cheap goods.

NO DRAMA

In a hearing marked by few testy exchanges, Bessent coolly fielded questions ranging from child tax credits to tariff impacts on farmers and did not stray from answers consistent with previous Republican Treasury nominees, but without contradicting Trump's policy plans.

He said that US spending on President Joe Biden's clean energy tax credit was "wildly out of control" and that high deficits in recent years were due to a "spending problem." Asked if a 100% tax credit for business research and development needed to be restored, he said his "inclination" would be to support that.

Democrats chided Bessent for taking advantage of a tax loophole, the legality of which has been disputed by the Internal Revenue Service, to reduce the Medicare taxes paid by his hedge fund by $910,000 over three years.

"This is exactly the kind of abusive scheme that leaves Americans feeling disgusted with our tax system," said Senator Ron Wyden, the panel's top Democrat.

Bessent said that he would set aside funds to pay any taxes owing once the case is decided. He has pledged to shutter Key Square to avoid conflicts of interest if his nomination is confirmed.

FED INDEPENDENCE

Markets were expected to scrutinize Bessent's comments on keeping the Federal Reserve independent for clues as to whether Trump would try to exert control over the US central bank given the president-elect's frequent complaints over Fed interest rate decisions.

But Bessent came down firmly on the side of Fed monetary policy independence, adding that Trump would still make his views known.

"I think on monetary policy decisions, the FOMC should be independent," he said, referring to the Fed's rate-setting panel, the Federal Open Market Committee.

Although some economists have said that Trump's plans to impose tariffs, cut taxes and curb immigration would be inflationary, Bessent disagreed, saying Trump's plans, including increased energy production, would lower inflation to the Fed's 2% target while increasing wages.

Despite Trump's longstanding complaints about a strong dollar hurting US exports, Bessent said: "Critically - critically - we must ensure that the dollar remains the world's reserve currency."

Bessent also rejected the idea of a central bank digital currency for the Fed, saying that the dollar's wide use and security made this unnecessary. He said he was open to the idea of creating a US sovereign wealth fund, but said the US needed to get control over short-term deficit growth first.

HIGH DEBT, LESS CAPACITY

Bessent vowed that there would be no debt default on US Treasury debt under his watch. Asked whether Congress should abandon the federal debt ceiling, Bessent said that if Trump requested that, he would work with Congress to make it happen.

The high debt level means that there is less capacity to borrow heavily to combat a crisis, Bessent said, citing examples of the 1930s Great Depression, World War Two and the recent COVID-19 pandemic.

"Treasury – along with the whole of government and Congress - has used its borrowing capacity to save the union, save the world, and save the American people," Bessent said. "What we currently have now, we would be hard pressed to do the same."