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Doing it in La Défense

Paris wants to become the next City of London. What are its chances?

The Financial Times reports that French economy minister Christine Lagarde (she who previously called for ‘trendy trading floors’) is launching a new assault on the City’s financial primacy.

Lagarde’s latest efforts look a little more punchy and include lower disclosure requirements for companies listing on the Paris-based NYSE-Euronext exchange, less red tape, and recent tax cuts to benefit high earners.

The move follows the release of a report yesterday which put London in pole position among global financial centres and Paris in 11th place.

The FT quotes Lagarde as saying: “One shouldn’t rejoice in the misfortune of others. All the same, the weeks since mid-August show us that the strength of a financial market, and its reputation, do not count for much.”

Is Madame a little too keen to dance on London’s grave? And is Paris in any kind of position to capitalise on the City’s cadaverous hue? Let us know what you think.

Comments (22)

  1. Even if the french have the ambition to rival the City or NY they definetely do not have the stomach so far for it.

    For starters their labour legislation is appalling making it too costly to have people over there compared to London. In addition there is no sign that the government will be able to pass reforms easily. Secondly, the language of business is English and will continue be English. I doubt that the french will be willing to meet “language requirements” either in terms of their local workforce or people moving from London, NY, Singapore, Hong-Kong or wherever (notice all aforementioned cities were at some point in History under British rule [A coincidence maybe?]).

    As for listing requirements so far London continues to enjoy the top spot for new companies coming to be listed on the main market or admitted on AIM. Will the french government be able to succeed overnight what the City achieved since the deregulation?

    And finally, will the french be able to be open-minded enough to let go of national champions in all industries that really matter and improve efficiency(including banking)?

    Hope that is a little food for thought.

  2. Paris in terms of infrastructures has more assets than London. However only a real change in tax law will bring back all the French quantitative highly paid south-kensington traders from GS, JP, BNP and others to Paris.
    Also a change in labout law would be beneficial to improve flexibility and allow workers to “shop” around for better pay without the constraint of the stupid compulsory 3 month notice!

  3. Paris is definitively the place and saturday is the match!

  4. I’m in Paris, and as long as banks established in Paris won’t be keen to raise salaries. People are going to move to London. Plus, if you don’t have the specific diploma they want you to have you can’t do anytihing there. There’s no chance for Paris to reach the top places

  5. Maybe in 50 years !!!! Laws change quicker than mentalities…!

  6. pigs will fly…

    French banker in London Reply
  7. Perhaps the French need to fully accept the fact that English is the first language (especially in finance) before pursuing this. Besides, London and NY are already established, and the current downturn in the banking industry, albiet significant, is not enough to guarantee the success of a new global financial hub.

  8. From the negative comments above (even if part true), you can guess why “french mentality” can’t move forward…

  9. Cost of labour is WAYYYYY too high in France compared to UK, same for tax

    CB/Invst Bank/Paris Reply
  10. no way the French are up to it…a socialist country speaking French and narrow minded

  11. Ms. Lagarde means well and Sarkozy being so openly pro-american, we might be surprised by the wind of change (and the appetite for it in France). Yet, I have to agree with an ealier comment, any reform will take a while (especially in France) and Paris won’t achieve over night what London has been working on since deregulation in the 80s

  12. How the French can rival the city when they are still so racists when it comes to recruitment? They can leave open a position open for 6 months instead of hiring a foreigner or someone with good experience but not with a “grande ecole” diploma

  13. Paris would be perfect! I can smoke freely, have two hour lunch with nice red wine, and be away from work during the month of August. Paris certainly gets my vote.

  14. France have the better transport but i beleive within 10 yrs London could be in a better position than Paris. I can already see improvements with the Tube and with Cross Rail on the way this will have a massive impact. I could travel from my family home in Berkshire directly into Liverpool St.

    Regarding language i think the french ‘legand’ Chabalmade it clear!! An English reporter asked him ” may i ask you a question in English”, Chabal the French icon replied “No we are In francee and so wee shall speak francee” and then walked out of the interview. The fact this was viewed hundreds of thousands of times by proud french men on U Tube speaks volumes. English if the global language get over it!!

    Also the qualified skill base and the regulation etc etc i think will seriously hamper this French plan.

    Come on the Beafs, saturday is coming ;)

  15. I don’t enjoy this generality, there are in France the persons with a big opening-mind. The world doesn’t limit itself to one French which refuses to speak English.

    Although I am in the same mind, I find you very critical towards France and I wonder who is uppity ?

  16. France must awaken up to Globalization and accept people of mixed races. Then secondly welcome English as a co-existing language and finally connect to the new economic powers of the world. i.e China, Russia, India and soon to come Arica.
    Britain will not last long as a top financial centre, cos its basic infrastructures are fully stretched.

  17. Too many people here speak about French close-mindedness…I think English people are the one that are narrow-minded, because you don’t even speak (for a big part) an other language !! We, in investment banks of Paris La Défense, all speak at least english and work in english !! Some of us (like in my field of Structured Commodity Finance) even (and it’s not rare) speak a third language such as russian, chinese, portuguese (or simply german, spanish or italian)… So Open-mindedness is not at all the question here (since a lot of French work in London)..
    And concerning Chabal’s words :) he was entirely right to make english speaking people realise that each country in the world may have its own language (yeah !! it’s a concept called “foreign language” that you may have never encountered !!)…
    As far as i’m concerned I currently work in Paris, but i look forward to work in London next year ;)…and for some other reasons !

  18. Inflexible labour markets..a country regularly brought to a standstill by people striking and the stunning idea of a 35 hour week to stangle business.

    no chance

  19. It is impossible for Paris to significantly challenge London as long as most of the leading investment bankig and asset management companies will be american : most of the US expatriates will refuse to settle in Paris as they and their family don’t speak the language.

    That said there are a lot of groundless comments in favor of London. For example om tax. Income tax is indeed lower in France with a marginal tax rate of 40% applied only to 90% of the disposable income (hence an effective 36% rate vs 40% in the UK). If this is true that welfare costs are much higher in France compared to the UK, this is to some extent mitigated by the fact that your company is not obliged to contribute to a private health insurance or to a pension fund. On top of this, because housing/transport/food is much cheaper in France, you can afford to pay your employees less with no impact on their purchasing power. Last but not least it is also very difficult to fire people in the UK after one year.

    Bottom line this is a much more complicated issue than usually thought. What France needs to change first thing is its attitude for the financial industry, which is considered as useless for the economy…

  20. I think Paris is nice 4 a week-end, everybody i knew who lived there got seriously depressed. French r rude and backward, too closed a society, even more than English – far from ideal. To the point – one forward-looking economy minister is not enough to make all the change, her efforts are commandable but way too shallow. London is light years ahead, alas sadly this government is making steps to get rid of non-doms, etc., but Paris isn’t top of the list for them and the brains to go.

  21. As long as the french are stuck in the rut of believing they speak the world language, at the same time as enjoying a shorter working week and longer lunches………no chance!!

  22. And what is wrong with speaking your own language, long lunch hours, labour laws that try and protect people’s rights, taxes that fund public services? London’s current (or past) boom has we have seen is not sustainable…it is near impossible to make a life for oneselves unless part of the new non-dom banking elite and the 80% of other citizens here are getting sick and tired of it.

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