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Business

Paris Seeks to Lure Bankers From London

The forum "Place financiere de Paris: Welcome to Europe" seeks to position Paris as a financial rival to London despite disadvantages

Paris wants to position itself as an alternative to London in case of Brexit, photo: Reuters/Gonzalo Fuentes
By Reuters Whatsapp Twitter Facebook Share
2 years ago

PARIS — Paris can be an alternative to London for financial professionals in the event of Britain voting to leave the European Union, backers of a major marketing campaign said on Wednesday just two weeks before the British referendum.

Ile-de-France regional president Valerie Pecresse (C), French bank Societe Generale Chief Executive Frederic Oudea (2ndL) and Patrick Devedjian (R), President of the General Council of Hauts-de-Seine, attend an economic forum called "Place financiere de Paris: Welcome to Europe" at La Defense business and financial district near Paris, France. Photo: Reuters/Gonzalo Fuentes

Ile-de-France regional president Valerie Pecresse (C), French bank Societe Generale Chief Executive Frederic Oudea (2ndL) and Patrick Devedjian (R), President of the General Council of Hauts-de-Seine, attend the economic forum called “Place financiere de Paris: Welcome to Europe.” Photo: Reuters/Gonzalo Fuentes

European financial centres, such as Dublin, Frankfurt, Luxembourg or Paris, will be anxious to attract as big a share as possible of the UK’s financial industry if Britain votes ‘out’ on June 23.

“The referendum has encouraged major international companies, particularly in London and New York, to consider rebalancing their businesses towards the euro zone,” Gerard Mestrallet, head of the Paris marketplace lobby, said.

“For this reason, we as a group are ready to promote the competitiveness and appeal of the Paris financial marketplace,” said at a conference dubbed “Paris: Welcome to Europe”.

The initiative, bringing together officials from the Socialist-controlled Paris City Hall, opposition conservative leaders and financial professionals, was the biggest coordinated push by Paris so far to get a slice of the UK finance cake in the event of victory for Brexit.

“Britain can’t blackmail Europe forever without getting a response at some point,” said Patrick Devedjian, head of the big business Hauts-de-Seine area, referring to British demands for opt-outs from many EU policies.

However, France should stop bashing bankers and ease its tax regime for financial institutions if it wants to mop up London business, some said.

“I heard our president say that our enemy is finance. There is nothing more stupid. Our enemy is unemployment,” Valerie Pecresse, the conservative head of the wider Paris region said, adding that a strong financial sector was essential for French sovereignty.

Though undergoing tough times with banking job cuts, strategy overhauls and the forthcoming referendum, London remains the key destination for bankers, including those with French passports, who feel under-appreciated and overtaxed by the centre-left government at home.

“Let’s be honest, we are in the challenger position,” Societe Generale CEO Frederic Oudea said at the event at La Defense, once a beacon of French financial might.

He urged a rethink on France’s tax system which many see as punitive and a deterrent to business.

Elected in 2012 on traditional left-wing rhetoric that included labelling the world of finance as “the enemy”, President François Hollande slapped a 75 percent tax on millionaires which, although temporary, dented France’s image among investors, according to French officials.

French bank Societe Generale Chief Executive Frederic Oudea speaks during the forum in La Defense financial district. Photo: Reuters/Gonzalo Fuentes

French bank Societe Generale Chief Executive Frederic Oudea speaks during the forum in La Defense financial district. Photo: Reuters/Gonzalo Fuentes

Despite a pro-business U-turn in 2014 – which saw his prime minister tour world cities to claim his “love for business” — and the fact that the top rate of income tax is now the same as in Britain, Paris has struggled to lure over bankers.

The Paris Europlace financial lobby called for more tax incentives, such as an extension of tax relief for expatriates to 10 from five years and urged authorities to upgrade key infrastructure in Paris in the coming years.

In particular, they called for a quick completion of the long planned express train link from Charles de Gaulle airport to the city centre and a renovation of the Gare du Nord train station, often unfavourably compared to the recently upgraded St Pancras station across the Channel in London.

However, major initiatives by the Socialist government to help the banking sector less than a year ahead of presidential elections would be something unrealistic in France.

Despite the clear will to position Paris as a continental alternative, none of the officials said they were in favor of Britain leaving the EU.

“Our generation should prevent this (Brexit) from happening … it (Brexit) would be the most significant event on the continent since the fall of the Berlin Wall,” said Stephane Boujnah, chief executive of Euronext, operator of the Paris bourse.

MAYA NIKOLAEVA

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