While the French media continue to follow closely the developments of the
Clearstream scandal, the latter's implications on France's political and
industrial landscape remain largely unknown even to the most informed public.
This is due both to the caution used by the specialised press in dealing with
the issue and to the scandal's complexity.
Since France is a key player in the European Union and in the Euro-Atlantic
relations, any significant change in its domestic power configuration – both
political and economic – will have an impact on international politics and
global business. The consequences of the Clearstream's scandal are, thence, the
real issue – much more of the dramatised story that excites the press. However,
in order to understand what is going to happen, the background of the affair
needs to be briefly exposed.
The Background
Clearstream, based in Luxemburg, is the clearing division of Deutsche Börse
Group. Its tasks are thus related to electronic transitions, whereby reporting,
risk margining, netting, tax as well as failure handling are the core of its
activities.
The current Clearstream scandal is also known as "the second Clearstream
affair", and is not to be confused with a previous one (dating back to 2001)
linked to alleged money laundering and tax evasion. The current affair was
originated in 2003 and involved the question of France's selling of six
frigates to Taiwan, following a 1991 deal.
According to the accusations, such Franco-Taiwanese deal allowed certain
political decision-makers to illegally receive percentage fees – thanks to
secret Clearstream's accounts allegedly discovered by a hacker with ties to
France's intelligence services. Such accounts were in fact mentioned in a list
that magistrates believe to be a fake. The scandal rapidly progressed and
involved politicians (among which Interior Minister Nicolas Sarkozy) and top
managers linked to the E.U. key defence and aerospatial giant, E.A.D.S.
The timing of the scandal's outburst is essential to understand its actual
and potential implications. The media campaign of 2006 looks particularly
dangerous for France's present Prime minister, Dominique de Villepin and the
Chirac-Villepin faction in the Gaullist party, U.M.P., with "collateral
damages" for E.A.D.S. Back in 2003, however, it was E.A.D.S. the primary
target.
The key players of the manipulation have been Jean-Louis Gergorin,
vicepresident of E.A.D.S., and Imad Lahoud, an intelligence agent and computer
expert.
A widespread belief was that the accounts were revealed in order to prevent
Noel Forgeard to obtain the co-presidency d'E.A.D.S. to the profit of his
competitor, Philippe Camus, supported by Jean-Louis Gergorin back in 2003.
However, such claims are flawed by an evident contradiction: not only Noel
Forgeard becomes co-President of E.A.D.S., but he chooses Jean-Louis Gergorin
as vicepresident, while Imad Lahoud becomes Scientific Director.
As Forgeard knew Gergorin and Lahoud perfectly, it is unthinkable that he
could have chosen them for vital corporate roles if he suspected that they
consistently tried to damage his career.
Therefore, it is likely that Gergorin and Lahoud didn't fabricated the false
list of accounts. A credible hypothesis is that the Clearstream's electronic
network had been hacked by Lahoud, who probably fell prey to a so-called
"honeypot". A honeypot is a kind of anti-hacker trap, designed to deflect and
counteract attempts at unauthorized use of information systems, since it seems
to contain information would be of value to pirates.
The obtained fake list would have then been transmitted by Lahoud to a
French top intelligence officer, General Rondot, asked by Villepin himself to
verify the list's authenticity. The problem is that many conjectures are being
made regarding the real aims of the entire manipulation. What is important,
however, is the present use of the available information and the political
management of the scandal's perception.
In other words, the Clearstream affair remains important beyond its real and
initial rationale, because it may significantly weaken certain French
decision-makers in the run up to the 2007 presidential elections.
Domestic Political Implications
As of June 2006, the main implication of the Clearstream affair has been the
further weakening of an already troubled French government, and particularly of
Dominique de Villepin. The latter appeared in late 2005 as a candidate for 2007
with good chances to succeed. He did so after his first months at Matignon were
marked by a decrease of unemployment rates and the launch of an ambitious
energy policy.
However, Villepin had to face a strong competitor inside the U.M.P., that of
Nicolas Sarkozy. Therefore, when Villepin stumbled over the massive protests
against his sponsored C.P.E. (a proposed contract for young employees that
significantly loosened hire and fire rules), Sarkozy immediately moved to
benefit from the situation by taking the initiative and launching negotiations
with students and trade unions.
Sarkozy already tried to take the actual political leadership in November
2005, as France's social life was destabilised by riots. Now, after Villepin
was caught in the Clearstream affair, it looks like the Prime minister will
have little choice of being elected in 2007, even though Chirac will likely
continue to support him and to fight back in the information warfare that
followed the scandal.
As a consequence, the rising star of Socialist Party, Ms Ségolène Royal, is
taking advantage out of the U.M.P.'s inner battle, and she looks increasingly
fit to win the presidential election's first round next year – which would put
her in competition with the second most successful candidate in the final
play-off.
Because of the Sarkozy-Villepin frictions, Sarkozy may lose some of his
supporters, should he appear to a large part of French citizens as someone who
unduly exploits his allies' troubles. Therefore, the Interior minister will
have to move carefully in the coming months, balancing his competitive strategy
against Villepin with a successful hegemonic tactique within the French
right-wing.
Failing to do so will put Sarkozy's chances at risk, and will once again
launch the far right National Front's leader, Jean-Marie Le Pen, as the
surprise challenger to the whole establishment.
Since France experiences a difficult political phase, culminated with the
2005 establishment's failure to win the referendum on the E.U. Constitutional
Treaty, all the 2007 candidates will try to capitalize on the citizenship's
malaise with the "same old politics". The new wave of anti-E.U. feelings and
rhetoric has given strength to the sovereignist discourse in the last couple of
years.
However, the genuinely sovereignist right-wing party, Villiers' Movement for
France, isn't as rooted as the National Front among French voters and, more
importantly, does not epitomize the anti-systemic feeling like Le Pen does.
Thus, Villiers' plans to seduce a large part of the National Front's
sympathisers and supporters look difficult to succeed, notwithstanding Le Pen's
isolation from France's media system, since the National Front still
capitalizes past years' political rooting. This largely explains why in some of
the newest polls, Le Pen was chosen by 10 to 14% of voters as their 2007
candidate. That figure may be little impressive, but the National Front's
leader was credited with even less votes one year before his surprising success
of 2002.
While Sarkozy will obviously use the next six-eight months to secure his
maximum potential among his supporters and those of the broader French
right-wing landscape, Le Pen will be a serious challenge to the Interior
Minister's strategy of winning all of the most conservative votes -- even
though in past occasions, the candidate who took the lead in the polls
conducted one year before the election never succeeded to actually win.
International and Industrial Implications
As explained, the Clearstream affair went off in 2003 and then, its main
victim appeared to be E.A.D.S. Back in 2003, the Euro-American feud over the
Iraqi war was in its most critical phase, as Chirac and Schroeder tried to lead
Europe in a strategic alignment with Russia against the U.S. unilateral views.
Because the French government maintains a golden share of 15% in E.A.D.S., and
is deeply involved in its corporate governance, a blow to E.A.D.S. credibility
could have been a serious threat for the Franco-German political-strategic
combine.
To destabilise and weaken the E.A.D.S.'s governance would in fact mean to
damage the most important Franco-German defence and aerospatial industry, with
serious consequences for Airbus (80% owned by E.A.D.S. ) as well.
E.A.D.S.'s main competitors globally are U.S. giants such as Boeing and
Lockheed Martin; however, E.A.D.S. also tried to seek inroads in the U.S.
market. The E.U. corporation is at the same time a strong business rival for
the U.S. majors and the core of the European industrial military complex.
With the revival of the Clearstream affair, thus, E.A.D.S. security looks
once again endangered, although the present scandal appears to be used maily by
French political forces to gain a decisive advantage before the presidential
elections - notwithstanding the experience shows that such political manoeuvres
around the issue may backfire. If Gergorin's position will worsen in the
follow-up of the investigation, the E.U. giant's governance will be seriously
struck, at a time of even increased global competition in space, satellite,
defence and commercial jet industries.
In addition, the scandal may change the balance of power inside E.A.D.S.,
since the German side in the group looks irritated by the political
machinations and could demand the French state to reduce its involvement in
E.A.D.S.
Such a possibility would highlight France's lack of a clear industrial
strategy, whereby market-oriented policies appear often at odds with the need
of protecting vital defense and energy-related assets. It would also jeopardise
Paris' ambitions to politically lead the evolution of the European security and
defense policy.
Whereas such a development is only a possible, and not a certain one,
further calls for implementing an effective public policy in the field of
economic intelligence (i.e., economic patriotism) are to be expected in France,
as the country approaches key presidential elections.
Conclusions
The Clearstream scandal is showing how strategic industrial and political
affairs are tightly linked in today's power and interest struggles. Although
the whole issue originated in a specific context, and for some still partially
obscure reasons, its echoes are being used by different actors in order to
pursue their individual interests.
France – which is by far the most ambitious Western European country when it
comes to projecting its power and influence globally – appears still vulnerable
precisely in those strategic sectors that Paris is trying to protect. The
reason is that France's economic security and intelligence dispositions, even
if largely theorised and discussed, look still flawed and exposed to dangerous
attacks.
Copyright © Federico Bordonaro & Jean-Philippe Miginiac
Tous droits réservés
Cet article a également été publié le 05 Juin 2006 dans The Power and Interest News Report
(PINR)
