Bailouts generally fail

[G7H+]

Europe bail-out aid fails to save jobs

Billions of euros spent by European governments to prop up failing companies in the hope of saving jobs may have been misdirected, an EU-commissioned report is suggesting.

A two-year study by the Oxera consulting firm for competition officials at the European Commission has found that survival rates for “distressed firms” may be lower when they receive government bail-outs than if they are not aided.

It also challenges the EU policy assumption that restructuring aid necessarily saves “jobs and activities which would otherwise disappear”.

After scrutinising more than 1,300 large, struggling companies, the report finds job loss implications tend to be linked to factors such as the previous speed of expansion, degree of indebtedness, and whether the company is operating in a depressed area, where training and opportunities for displaced workers are poor.

The findings come at a time when general economic difficulties could bolster the desire of many EU governments to bail out companies and sectors.

State aid across the 27-country bloc has already surged from about €66.5bn ($90bn, £58bn) in 2007 to €280bn in 2008. While much of the increase was owing to bank bail-outs, the prospect of governments offering aid packages on the grounds they will secure manufacturing jobs remains rife – for example, GM-Opel.

But the report – which was commissioned before the financial crisis struck – could encourage EU competition officials, who must vet state aid applications, to target assistance more carefully and question some of the “job-saving” justifications put forward by member state governments.

The study may help the commission as part of a move towards a refined economic approach to state aid, and towards “less and better-targeted aid”, said Luis Correia da Silva, Oxera’s managing director.

One of the report’s key findings is that 77 per cent of Oxera’s sample of “unaided” distressed firms were either acquired or continued reporting three years later, while 23 per cent went out of business. That compared relatively favourably to an earlier London Economics study which found that one-third of the 70-plus cases where the commission actually granted restructuring and rescue aid between 1995 and 2002 subsequently failed.

Oxera analysts point out that drawing direct parallels between the two samples is fraught with dangers because the severity of the companies’ problems may have been different in the two samples. Nevertheless, their study observes: “A simple comparison between these results suggests that the aid beneficiaries … were less likely to continue trading, more likely to be acquired and less likely to survive with unchanged status”.

There was no immediate comment from the commission. It had originally planned to use the study to help inform an overhaul of the rescue and restructuring aid rules in 2009, but this has now been pushed back to 2012 because of the economic crisis.

Source: http://www.ft.com/cms/s/0/e06db68c-1bef-11…144feab49a.html

Le rapport complet ici : http://www.oxera.com/cmsDocuments/Restruct…state%20aid.pdf

Je crois que ce serait très très intéressant d'avoir l'avis d'un économiste (xara ?) sur ce rapport. Ca peut aussi être une source d'information importante (quelles sources utiliser ? comment structurer/présenter nos analyses ?) pour "nos" think-tanks.

[Lexington]

Je renvoie vers l'article que tu as la modestie de ne pas citer http://www.contrepoints.org/Les-plans-de-s…-europeens.html