Busi­ness lead­ers urge swift re­sponse to Brexit

The Myanmar Times - - International Business -

FI­NAN­CIAL movers and shak­ers gath­ered in France on July 2 urged a clear and timely po­lit­i­cal re­sponse to lift the uncer­tainty caused by Bri­tain’s shock vote to leave the Euro­pean Union.

A raft of top busi­ness lead­ers and in­tel­lec­tu­als have gath­ered in the south­ern French city of Aix-en-Provence for a three-day meet­ing to dis­cuss how to re­act to the fall­out from last week’s “Brexit” vote.

Par­tic­i­pants swiftly agreed on at least one thing – no­body is quite sure what is go­ing to hap­pen next, the un­der­ly­ing source of their wor­ries.

Bri­tain has not yet be­gun the process of dis­en­gag­ing it­self from the Euro­pean Union, with ar­gu­ments rag­ing af­ter the coun­try was split 52 per­cent to 48pc in the ref­er­en­dum.

Renault-Nis­san au­tomaker gi­ant head Car­los Ghosn said the loss of Bri­tain in it­self from the EU bloc was not so much the prob­lem as were the un­cer­tain­ties such a move would pro­voke.

“Wor­ried? Yes,” said Mr Ghosn. “Not be­cause of Brexit, but wor­ried by the uncer­tainty that has en­gen­dered.”

For Mr Ghosn, “com­pa­nies, good or bad, are ca­pa­ble of adapt­ing to ev­ery­thing – all kinds of sit­u­a­tions”.

But with Bri­tain’s new status re­gard­ing the Euro­pean Union not clear, he said firms would have to live with uncer­tainty. “We are go­ing to nav­i­gate as we go along,” said Mr Ghosn, not least re­gard­ing the post-Brexit fu­ture of Nis­san’s fac­tory em­ploy­ing 8000 in the north­east of Eng­land.

Oil gi­ant To­tal’s CEO Pa­trick Pouyanne said for his part that Brexit would “not have a di­rect im­pact” as likely ster­ling weak­ness could bring down pro­duc­tion costs for the group’s North Sea op­er­a­tions.

“On the other hand, Brexit will have Euro­pean growth im­pacts on the macro-eco­nomic front and that could cause dam­age,” Mr Pouyanne said.

“There is an el­e­ment of more uncer­tainty [and] in­sta­bil­ity in a world which is al­ready fac­ing up to a range of geopo­lit­i­cal dif­fi­cul­ties, with Daesh [the Is­lamic State], Ukraine, a swathe of fi­nan­cial crises and now Brexit.”

US rat­ings agency SP Global Rat­ings cut its rat­ing for the EU by one notch last week cit­ing the uncer­tainty cre­ated by the Brexit vote.

“The only mes­sage I would like to trans­mit is we have to act fast,” said Mr Pouyanne – with the risk be­ing that al­low­ing uncer­tainty could “de­stroy con­fi­dence” in the whole bloc.

Politi­cians in­di­cated they un­der­stand that mes­sage and its ur­gency.

“The first thing to do is lift the uncer­tainty as soon as pos­si­ble so that eco­nomic ac­tors are able to take de­ci­sions quickly, in­clud­ing de­ci­sions per­tain­ing to in­vest­ment and de­vel­op­ment,” French Min­is­ter for Fi­nance Michel Sapin said Fri­day.

“To­day,” Mr Sapin added, “I feel eco­nomic ac­tors are de­mand­ing po­lit­i­cal de­ci­sions – per­haps a re­vamp­ing of pol­i­tics?”

Paris is look­ing to use Brexit as a chance to bol­ster the at­trac­tive­ness of France, and Prime Min­is­ter Manuel Valls gave an in­ter­view to Le Parisien in which he set out France’s stall to that end.

“We are work­ing on [a] means of re­in­forc­ing our at­trac­tive­ness. I am think­ing no­tably of tax pol­icy or the status of ex­pa­tri­ates. So I say to large in­ter­na­tional com­pa­nies, ‘Wel­come to Paris! Come and in­vest in France,’” said Mr Valls.

“We are the num­ber-one fi­nan­cial mar­ket­place in the eu­ro­zone in terms of di­rect and in­di­rect em­ploy­ment with 1.2 mil­lion jobs,” said Muriel Peni­caud, di­rec­tor gen­eral of Busi­ness France, a pub­lic body tasked with show­ing off France’s plus points to the busi­ness world.

The group has just pub­lished a pa­per high­light­ing rea­sons to do busi­ness in Paris, in­sist­ing the cap­i­tal of­fers a strong stock mar­ket reg­u­la­tory and fi­nan­cial sys­tem.

‘Wor­ried? Yes. Not be­cause of Brexit, but wor­ried by the uncer­tainty that has en­gen­dered.’

Car­los Ghosn Renault-Nis­san

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