Review of the year: France

As sour vintages go, France has known worse years than 2005. But not many.

In May, French voters shredded a largely French-inspired constitution for the European Union - ending half a century of de facto French leadership on the Continent. In November, the revolting brown, black (and some white) youth of deprived suburbs set light to 10,000 cars and made a bonfire of France's claim to be an enviable model of social solidarity and racial integration. And in July, Paris - convinced its turn had come at last - was beaten to the tape by London in the race for the 2012 Olympics. This was a bitter symbolic blow. It was read by many in France as a sign that the Rest of the World - represented by the International Olympic Committee - regarded London and Britain, not Paris and France, as the European cutting edge of the early 21st century.

Even French cuisine and wine - vital to France's self-identity and much-envied sense of art de vivre - had a miserable 2005. A poll of 500 international gastronomic experts by Restaurant magazine placed just one restaurant in France in the world's top 10. French wine exports dropped sharply once again. Is there a common cause to the disparate events in France's année horrible? The Rest of the World (especially the Anglo-Saxon part of it) insists that France is an arrogant country, too pleased with itself to be capable of adapting to a changing globe.

Seen from the inside, France's problem often seems to be more a lack of confidence and divided identity. The aversion to change is partly understandable - France has much to lose. However, the immobilism - perfectly represented by President Jacques Chirac - can also be self-defeating and short-sighted.

France has much going for it. Productivity remains higher than in Britain; foreign investment is booming; growth may be ahead of Britain's next year. Yet high unemployment, hovering around 10 per cent for 20 years, is an unspoken choice of the French system. France talks of "solidarity" but its tax and welfare structure favours the middle-ranking "haves" over the "have-nots".

The rejection of the EU constitution was seen by many as a cry for change, a "revolt" against the élites. In truth, it was driven mostly by fear: exaggerated fear that France might not make its voice heard in the eastwardly-expanding EU; absurd fear of an invasion of Polish plumbers; selfish fear that more competition at EU and global level might dissolve the privileges of the great mass of the middle and state-employed classes.

The riots in poor suburbs were not a Muslim intifada but an irreligious, apolitical revolt by marginalised and under-educated youth. The suburban kids - almost all French-born and thus French - are somewhat marginalised by racism, both open and disguised. Ultimately, they are marginalised by unemployment, and the inability, or refusal, of the system to make space for them. They are the most extreme victims of the "what we have we hold" principle that dominates France.

Many of the same issues resurface in the wine crisis. Top-quality French wines still flourish unchallenged, but medium and low-value bottles continue to be pushed off the shelves in Britain and elsewhere by more reliable, recognisable brands from Australia, Chile and even Italy. The probable answer is to abandon, at the lower end, confusing appellations and château names, and instead concentrate on marketing a few, clear, good-quality brands associated with popular grape varieties and regions. Sectoral and selfish interests - plus a concern for tradition - are holding back the inevitable change. Meanwhile, the grapes of wrath are already fermenting in the south and south-west. Rural riots may replace suburban ones in 2006.

Voters complain that French politicians are immobile, but they accurately reflect the immobilism of the core French electorate. Immobile until now, at any rate... This year will go down as the end of the Chirac era. The old man (73 last month) was not just weakened by the referendum defeat and the riots: he seemed baffled by them. His eye troubles in September crushed his remaining hopes of running for a third term in 2007.

The campaign to succeed him has already begun. The likely main candidate of the scattered Left remains obscure. On the centre-right, there are two contenders. The first is a tall, handsome, patrician poet who flatters the French and tells them that nothing much needs to change (Dominique de Villepin, alias Chirac II). The second is a small, dark man with big ears and a foreign name who tells the French that they must face up to painful "rupture" with the past (Nicolas Sarkozy). It is a fascinating - and momentous - choice.