Post-Brexit Opportunities for France?
France like the rest of Europe is still reeling from the UK vote to leave the European Union. What does it mean and how will it affect in our everyday lives?
All unclear for the moment, but for French business and finance circles centered in Paris some opportunities that may be opening up are already being discussed.
First and foremost, may be a historic shift in where the financial nexus for European capital sits. For years, London has clearly been the undisputed center of European and Western Finance dealings. However, as the major big European banks plan to move activities into the euro area, and the European banking authority is leading this move…the question arises to where?
Paris is in a very good position to put itself forward as “the” place to move:
- It’s a center of asset management of 3,6000 billion euros
- Home to 5 major French banks that are in the largest 20 in Europe
- Has a ready and internationally trained workforce
- Paris leads in market funding at 60%, bond conditions greatly improved after 2010
Also important in this decision will be the “quality of life” of the city being considered. Paris and London have both long vied for having the most attractive living environment, something which is key to attracting international and high level quality personnel.
Another opportunity to attract emerging businesses to France, and to Paris in particular, is with the London based fintech companies. Post Brexit many of these new start-ups will be anxious to relocate in the EU in order to have free access to European finance markets. Alain Clot, President of France FinTech, sees France as a logical relocation choice for these companies based on its personnel expertise in both finance and data science. In addition he cites “a more conciliatory French regulator” for the new companies.
Michel Sapin, French Finance Minister is talking with Paris EUROPLACE, an organization representing the diversity of players in the French financial industry about how to better place France as a logical choice for relocation. Extensions in repatriation taxes, continued lowering of corporate tax, and management costs are at the top of the list for discussion. Also on the agenda are improving Paris regional transportation, supports for the housing market and ensuring quality education in foreign languages.
While there is much confusion about the overall fallout from Brexit one consequence is clear. London’s role as finance capital of the euro area is over. Gérard Mestrallet, President of Paris Europlace, says France must mobilize to make Paris the new Finance capital of the euro zone. Despite the general consensus that Brexit is a heavy blow to the UK and the EU in general, it may prove to provide new opportunities and growth in France.
By Didier Hemion
International Business Services