French President Macron on EU Spending, Banks M&A, China (Full Interview)

Summary

In a discussion with Bloomberg, French President Emmanuel Macron outlines his vision for France and Europe amidst global economic challenges. He highlights the reforms France has undertaken since 2017, including tax cuts, labor law changes, and adjustments to pension and unemployment schemes. Macron emphasizes the need for Europe to be more innovative and competitive, advocating for a single market and capital market union to boost investment and productivity. He also addresses the importance of a balanced approach to decarbonization, ensuring growth is not hindered by overregulation. Furthermore, he discusses the necessity for a fair trade policy, particularly concerning China, where he calls for reciprocity in tariffs and production rules to protect European businesses from unfair competition.

Takeaways

• 📈 President Macron emphasizes France's commitment to reforms since 2017, including tax cuts and labor law changes, to improve the business environment.
• 💹 Despite economic challenges, France has attracted €15 billion in investments, showcasing its ongoing efforts to make the country more business-friendly.
• 📉 France's economy has grown at about half the pace of the U.S. since Macron's term began, highlighting the need for further growth and competitiveness.
• 🤝 Macron stresses the importance of not only making France more business-friendly but also making businesses more inclined towards investing in France.
• 💼 The French state's high share of GDP (57%) and bureaucratic red tape, which is about 3% of GDP, are identified as areas needing reform to improve attractiveness to investors.
• 🔍 Macron outlines a vision for France and Europe to become frontrunners in innovation and investment, addressing the gap in value per capita created compared to the U.S.
• 🌱 A focus on climate, digital growth, and job creation as the three pillars of policy to drive the European economy forward.
• 💡 The need for a European policy that fosters innovation, efficient capital markets, and investment from both a common budget and the private sector.
• 🚀 Macron calls for a reset of the European economic model to increase value creation, innovation, and job quality, in light of changing global dynamics.
• 💰 He discusses the necessity for a more integrated capital market union in Europe, to allow for the consolidation of banks and a single system of resolution and supervision.
• 🤝 Macron expresses openness to cross-border mergers and acquisitions within the EU, as part of efforts to consolidate and strengthen European businesses.

Q & A

What is the main focus of President Macron's efforts in preparing France for business?

President Macron's main focus is to make France more business-friendly while also encouraging businesses to invest in France. This involves reducing bureaucracy, implementing tax cuts, and making reforms in labor law, corporate taxes, pension schemes, and unemployment mechanisms.

How does President Macron view the current state of France's economy in comparison to the US?

President Macron acknowledges that France's economy has not grown as rapidly as the US since he took office, with France's growth being roughly half as fast. He points to a lack of innovation and investment as the primary reasons for this disparity.

What are the key reforms President Macron plans to launch in the near future?

President Macron plans to launch a new set of labor market reforms and a simplification and attractiveness package for finance. He also intends to prepare for further reforms on the labor market in September.

How does President Macron perceive the European economy in comparison with the US and China?

President Macron sees Europe as lagging behind the US and China in terms of innovation and investment. He emphasizes the need for a more innovative European policy, more efficient capital markets, and greater investment from both a common budget and the private sector.

What is President Macron's stance on the European single market and capital market union?

President Macron supports the consolidation of a single market and capital market union in Europe. He believes that there should be a single system of resolution and supervision to create a more integrated market. He also sees the need for a Franco-German consensus on this matter.

How does President Macron respond to the idea of French companies like Total moving their primary listing from France to New York?

President Macron expresses his disapproval of such a move and states that he would be very surprised by it. He suggests that rumors of Total's CEO considering such a move are not based on confirmed information.

What is President Macron's view on the wealth accumulation in the luxury and fashion sectors in France?

President Macron sees the success of individuals like Bernard Arnault, whose wealth has increased significantly, as a positive development. He highlights that these sectors provide competitive advantages for France and create jobs that are difficult to relocate.

How does President Macron address the issue of reciprocity in trade with China?

President Macron advocates for a level playing field in trade with China, emphasizing the need for fair competition in terms of tariffs, subsidies, and rules of production. He seeks reciprocity and modern technologies to ensure fair trade practices.

What is President Macron's perspective on the role of innovation and productivity in Europe's economic growth?

President Macron believes that innovation and productivity are key to Europe's economic growth. He stresses the need for more investment in these areas, both from public and private sectors, and for a new business model that emphasizes innovation, investment, and a single market.

How does President Macron view the necessity of a tougher European stance towards trade?

President Macron sees a tougher European stance as necessary not out of protectionism, but to protect the region from unfair measures and to ensure the survival of European businesses in the face of global competition.

What is President Macron's approach to dealing with the challenges posed by globalization and the changing geopolitical landscape?

President Macron's approach involves continuous reform and adaptation to the evolving geopolitical landscape. He emphasizes the importance of innovation, investment, and a unified European policy to address the challenges of globalization.