France’s government proposed a pro-growth reform Bill yesterday that is crucial for avoiding EU sanctions but risks being watered down by left-wing lawmakers angry with President François Hollande’s deregulation drive.

The Bill – which polls show the French themselves broadly support – aims to let shops open more often on Sundays and resolve disputes over firings more rapidly. It includes plans to deregulate the legal trade and cut red tape for construction.

It is France’s attempt to convince sceptical European Union peers that the eurozone’s second-biggest economy is carrying out reforms needed to get a new reprieve in March on its missed budget targets and avoid sanctions.

The Bill is spearheaded by new Economy Minister Emmanuel Macron, an ex-banker who has played a key role in Hollande’s pro-business switch.

“Considering the emergency situation of our economy, we don’t have the right to pass up this opportunity,” Macron said of the reform bill in a joint news conference with fellow reformist, Prime Minister Manuel Valls.

Valls said he was “certain” he could persuade enough lawmakers in the Socialist majority to pass the bill through parliament early next year.

The bulk of the measures are due to be in place by next June.

The Bill is spearheaded by new Economy Minister Emmanuel Macron

The Bank on France forecasts just 0.1 per cent growth in the fourth quarter of this year and data yesterday showed a worse-than-expected 0.8 per cent drop in French industrial output in October while paid employment fell 0.3 per cent in the third quarter.

But lawmakers to the left of the ruling Socialist Party have warned they would vote against the bill if it is not diluted and would even campaign against it, making this a major test for the most unpopular French president in polling history.

That promises tough debates in parliament for Hollande’s government in 2015, when it faces two sets of local elections and a Socialist Party convention in June, when politicians will start jockeying for position before the 2017 presidential elections.

“The government is therefore likely to remain between a rock (fading support for reforms at the National Assembly) and a hard place (European Commission recommendations) for some time,” analysts at Exane BNP Paribas said in a note.

“While we believe sanctions are still unlikely, the European Commission will probably require more efforts next spring,” they said.