France and EU constitution: No vote would hurt business

French Prime Minister &to=http:// ' target=_blank>Jean-Pierre Raffarin said on Wednesday the outcome of Sunday's referendum on the European Union constitution was still in the balance and urged voters not to use the vote to punish the government.

Opinion polls show opponents of the treaty are in the lead before Sunday's ballot and that many voters want to use it to show discontent with the conservative government's economic policies and high unemployment.

A French rejection of the constitution could kill the new charter, undermining France's role in the 25-member bloc and causing a crisis of confidence in the EU that delays integration and causes jitters on &to=http:// ' target=_blank>financial markets.

The uncertainty hanging over the French referendum was in stark contrast to Austria, which quietly completed ratification with a vote in the upper house of parliament on Wednesday, informs Reuters.

With the French looking increasingly likely to vote No in this weekend's referendum on the European constitution, one of France's most influential businessmen has warned that European competitiveness would be set back "10 years" if the treaty were rejected.

Claude Bйbйar, supervisory board chairman of French insurer Axa and head of the powerful Institut Montaigne business think-tank, painted a surprisingly pessimistic picture of how a No vote would hurt business by slowing the pace of reform, both in France and the rest of Europe.

Confirming his reputation as someone not afraid to express his opinion on all areas of public life, Mr Bйbйar condemned the "conservatism" of France's ruling politicians and questioned the government's decision to put the constitution up to a referendum in the first place.

"It will be very bad for European companies," said Mr Bйbйar, known as the godfather of French capitalism, in an interview with the Financial Times. "We will be weaker and so unable to do the reforms which are necessary. It will be more a shock in the medium term."

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