PARIS–French Economics Minister Arnaud Montebourg Thursday said talks with German company Siemens AG (SIE.XE) over a possible tie-up with Alstom SA (ALO.FR) were going forward despite the preference expressed by the French firm’s board for rival bidder General Electric Co. (GE)

“Discussions with Siemens are extremely constructive,” Mr. Montebourg told reporters on Thursday. “The evolution is very positive, which is not the case with GE.”

The comments from the minister come hours after the government signed a decree giving it extended authority to block foreign takeovers of companies deemed strategic.

In a two-page decree published in France’s Official Journal on Thursday, French Prime Minister Manuel Valls said he aimed to better protect the country’s security interests by enlarging the scope of sectors in which foreign investors must seek prior government approval to buy French businesses.

The decree, which came as a surprise, adds energy, water, transport, telecommunications and health care to an existing, narrower list of strategic sectors that included nuclear activities, encryption technologies and vaccines.

The new legal tool could give Mr. Montebourg a boost in his crusade for the independence of Alstom, supplier of the country’s signature bullet trains.

He has told parliament he wasn’t satisfied with terms of GE’s $13.5 billion cash bid for Alstom’s energy operations, and has invited Siemens to make a rival offer.

The German engineering company has said it was working on a possible bid for some of Alstom’s assets.

In a separate emailed statement, GE said Thursday it had “taken note” of the new decree, and pursued “constructive talks” with the French government. “Our industrial project is good for Alstom, its employees and for France,” it added.

By Inti Landauro and Noemie Bisserbe