France:The president faces his biggest tests yet - labour and pension reform, writes Lara Marlowein Paris
It was the year when France got interested in politics again, when for the first time the front-runners in the presidential election were born after the second World War, and a woman came within reach of the Élysée Palace.
It was also the year when a French leader finally embarked on economic reforms comparable to those already carried out elsewhere in Europe.
Nicolas Sarkozy virtually won the presidential election in mid-January, when he delivered a speech so rousing at his inauguration as the right-wing candidate that even the left-wing newspapers Le Monde and Libération praised him.
Before 50,000 people, Sarkozy repeated his standard themes of rehabilitating work and rewarding effort, but he cast a wider net.
"My France is the France of all French people, without exception," he said, appealing to "those who vote for extreme parties", as well as "the workers who believe in the left of Jaurès and Blum, and who no longer recognise themselves in the immobile left that doesn't respect work".
Pascal Perrineau, the head of the CEVIPOF studies centre at "Science Po" and one of France's leading political scientists, says Sarkozy won "because he embodied a rupture with what you might call Mitterrando-Chiraquism".
In the course of their 14- and 12-year reigns, France's two previous presidents seemed to settle into a lazy exercise of power, during which little changed.
The country fell to 12th of 27 in the EU in per capita income, and was recently ranked 18th worldwide for competitiveness by the World Economic Forum.
Sarkozy promised to reverse the decline.
"He put the idea of political will back in the foreground," says Perrineau, "the idea that it was possible to accomplish something politically, move the political, economic and social lines. He brought volontarisme - strong will and determination - back to politics".
In theory Ségolène Royal was better placed to win. She had symbolised the socialists' victory in the 2004 regional elections and won the party's first primary election in November 2006 by a wide margin. Until January she surpassed Sarkozy in opinion polls.
So why did Royal lose?
"The French hesitated between two models of the presidency," Perrineau says.
Sarkozy offered a "presidential" image of competence on big issues such as defence and foreign affairs; Royal based her campaign on "proximity" and "participative democracy". She sought to be a spokeswoman for the French people, to such an extent that when asked about her position on Turkish EU accession, she replied, "I think what the French people think."
The campaign was novel for the unprecedented level of what the French call "people-isation". The relative youth of Sarkozy and Royal and their celebrity friends fascinated gossip magazines. Both pretended to be in stable relationships. Royal revealed on the night of the legislative elections that she and the socialist leader François Hollande had parted, after raising four children together. Sarkozy and his wife Cécilia divorced in October, after months of speculation that she'd returned after a separation for the sake of his campaign.
Sarkozy is the first right-wing politician to have seduced a substantial part of the extreme right-wing electorate.
The National Front leader Jean-Marie Le Pen won 18 per cent of the vote in the first round in 2002. This year, for the first time in a quarter century, Le Pen's score plummeted to 10 per cent in the first round and less than 5 per cent in the June legislative elections.
Sarkozy was a tax-cutting economic liberal with businessmen in London, and a protectionist defender of French interests with workers and farmers. He captivated Le Pen voters with tough talk on immigration, serenaded the traditional right with patriotic odes to the nation and condemnation of "free-loaders".
And, adds Perrineau, "He launched a takeover of the left-wing values of work and 'republican meritocracy' which the left had dropped."
In foreign policy Sarkozy declared that "France is back in Europe", and played an important role in the adoption of the reform treaty one month after his election. He has reversed France's traditionally critical attitude towards the United States, praising the US as "the greatest country in the world" and adopting a stance as hardline as the Bush administration's against Iran.
Sarkozy's 53 per cent to Royal's 47 per cent was the highest score by a right-wing candidate against a socialist since de Gaulle beat Mitterrand in 1965. Sarkozy won even in left-wing bastions like Nord-Pas-de-Calais.
Yet unlike Jacques Chirac, who promptly forgot the socialists who voted for him against Le Pen in 2002, Sarkozy immediately translated his broad support into a gouvernement d'ouverture in which he included a half dozen socialists.
This "opening up", like his inclusion of members of ethnic minorities, further disorientated the defeated left.
In the seven months since he came to power, Sarkozy has made €15 billion in tax cuts, virtually dismantled the socialists' 35-hour working week, reformed the justice and university systems, weathered transport strikes and violence in the immigrant suburbs.
The strikes, over Sarkozy's insistence that transport workers put in 40 years like everyone else (instead of 37.5 years) before retirement, lasted for nine days in November. Yet unlike the 1995 "winter of discontent" that eventually brought down the Juppé government, the public no longer supported the strikers.
Some fault Sarkozy for granting pay rises to transport workers at the end of their careers, thus compensating the extra years with bigger pensions. There are more negotiations to come, and the unions say the strikes are merely "suspended." But Sarkozy stuck to the central principle of reforming the régimes spéciaux.
"He is very pragmatic and he has learned from the old French style of reforms, which may have been intellectually sound but which were imposed from on high by technocrats," says Perrineau.
Two nights of rioting in which 82 policemen were wounded, sparked by a collision between a motorbike and a police car, followed close on the transport strikes in November. But unlike November 2005, when similar rioting ignited a three-week explosion across France, Sarkozy managed to contain the unrest. On January 22nd, Fadela Amara, junior minister for urban affairs, will unveil his "Marshall Plan for the banlieues ," which will focus on jobs for immigrant youths.
Soon after his election, Sarkozy announced, "I want 3 per cent economic growth", as if wanting it was enough to make it happen. The French economy grew at best 1.8 per cent this year. Opinion polls show that rising prices, not unemployment (which is falling), are now the number one concern of French people, and 87 per cent say they don't trust the government to stem the rise in the cost of living.
Sarkozy has long told the French they don't work enough. Statistics recently published by Le Monde show the average British worker labours 2,019 hours annually, compared to 1,472 hours for the average French worker. His answer to French anxiety over declining purchasing power is longer working hours for better pay. There's no guarantee the French will buy it, and the biggest tests of Sarkozy's famous volontarisme, the reform of the labour code and the general pension system, are about to start.