Speaker 1: Let's go now to an exclusive conversation with French President
Speaker 1: Emmanuel Macron speaking with Bloomberg Stephanie Flanders in Berlin.
Speaker 2: Roller and thank you for organizing the seventh look. I
Speaker 2: hope the maximum number of items because I really believe
Speaker 2: that we are at risk. To be honest, and it's
Speaker 2: just a word. I think our own model was completely
Speaker 2: changed and has to be research. And when you look
Speaker 2: at the European model, largely based by the way on
Speaker 2: the strength of German during Germany during the past decades,
Speaker 2: we were based on exports and a big part of
Speaker 2: the key industry can making industry. To China, we were
Speaker 2: based on localst energy. Russian guys. We were based on
Speaker 2: deferend umbrella from the US without any question, and everything
Speaker 2: now is shaken. China has over capacities and is clearly
Speaker 2: a competitive place, so it's no more secured place for
Speaker 2: our exports. Russian war killed locals energy and the killer
Speaker 2: of our competitiveness today is a big gap in terms
Speaker 2: of energy prices every worse. This is why we have
Speaker 2: to completely change our business and have an integrated energy model,
Speaker 2: because we can deliver with nuclear and renewables, but not
Speaker 2: without being integrated and very clearly Afghanistan. Some people are
Speaker 2: gonna have doubts, and the potential change in leadership in
Speaker 2: the US means that this is not a guarantee total total.
Speaker 2: So this is I want to insist on that because
Speaker 2: it's super important to assess fairly the fact that our
Speaker 2: former model is over and this is not a question
Speaker 2: of act adjustment. This is not the same world twenty
Speaker 2: twenty four, twenty twenty five. And on top of that,
Speaker 2: we are making the same mistakes. On top of the
Speaker 2: key elements I mentioned, we are overregulating and underinvesting. So
Speaker 2: just if in the two to three years to come,
Speaker 2: if we follow our classical agenda, we will be out
Speaker 2: of the market, I have no doubt. So I think
Speaker 2: what we have to deliver in the two three years
Speaker 2: to come is capital market union. My view is that
Speaker 2: we have to rush on energy beyond what we already decided,
Speaker 2: which will be implemented for twenty twenty six, which will
Speaker 2: avoid the big pick and the unstability of the energy
Speaker 2: market we had during the past few years. We corrected that,
Speaker 2: but we have to go much faster and further, and
Speaker 2: we need this investment shock I mentioned and I think
Speaker 2: the simplification agenda and the derec let's say pose in
Speaker 2: terms of regulation, but even the regulation in some issues
Speaker 2: it's absolutely critical.
Speaker 3: Can you have any investment Can you have that investment
Speaker 3: shop without issuance of joint debt?
Speaker 2: I think you know the best way to deliver is
Speaker 2: not to to create big trauma at the beginning by experience.
Speaker 3: But you persuade, You persuaded the Germans before. Can't you
Speaker 3: do it again?
Speaker 2: This is true, but I was, if I want to
Speaker 2: be fair, I was a little bit helped by a
Speaker 2: colleague called COVID nineteen and it changed the reality. But
Speaker 2: what I think we have an external systemic shock. I
Speaker 2: think we have to assess that during the pandemic we
Speaker 2: all experienced a symmetric shock for all our economies. And
Speaker 2: this is why we made this move move with Chancellor Merkele,
Speaker 2: and I think it was a unique movement. This is
Speaker 2: really for me, a fundamental change of our EU. Now.
Speaker 2: I want us to be totally aware of the fact
Speaker 2: that we are leaving a symmetric shock on our economies
Speaker 2: whose scale and magnitude is underestimated because the real location
Speaker 2: factor is huge. Look at the chemical industry, in Europe
Speaker 2: completely being relocated because of Irea I mentioned, if you
Speaker 2: don't deliver the level playing filled agender, we will be
Speaker 2: super happy with rich as a good regulation for European consumer,
Speaker 2: but for no more existing chemical industry, and it will
Speaker 2: be the same for still it will be the same
Speaker 2: for I mean the existing business we have because of
Speaker 2: energy costs and overregulation. So we have to fix energy
Speaker 2: issue and overregulation and for me the single market and
Speaker 2: energy and on top of that, diversification of our phoney
Speaker 2: to reduce this discrepancy and acceleration of level playing field
Speaker 2: agenda and pose in terms of regulation is critical. And
Speaker 2: if we don't have the level playing field agenda, we
Speaker 2: will be killed in this market. And in parallel, for
Speaker 2: clean energy and artificial intelligence, we have to invest much
Speaker 2: more rapidly and protect as well or key players, otherwise
Speaker 2: they will be relocated in the US.
Speaker 3: Lars Hendrik I mentioned the joint debt question, but actually
Speaker 3: there's a broader issue here that you listen to President Macron,
Speaker 3: you read the drug report, you read many speeches frankly
Speaker 3: from from European leaders, but not from the German Chancellor,
Speaker 3: not from German leaders assessing the threat to the growth
Speaker 3: model in as fundamentally as this the stark language that
Speaker 3: President Macron has used it just if looking on the outside,
Speaker 3: if how will we get how does Europe move forward?
Speaker 3: Rush forward on this agenda? If there isn't that understanding,
Speaker 3: that same analysis at the top in Germany.
Speaker 4: I'm not sure that you don't share the analysis with
Speaker 4: with mister with the Chancellor shots obviously he's a different person.
Speaker 4: But I think the analysis that we need simplification what
Speaker 4: you were just saying, we need more investment, we have
Speaker 4: less regulation. I think that is something which you know
Speaker 4: the chancell he also says, and I think that's a
Speaker 4: fundamental issue. I think capital market union, as I said,
Speaker 4: is an important step. But in the end, and you know,
Speaker 4: he has been a remarkable European. I remember when you
Speaker 4: first came. You're actually a chaperd for a while. If
Speaker 4: I may say that.
Speaker 5: Yeah, both sapers together.
Speaker 6: Right, But he has moved on a lot.
Speaker 5: I don't think you should feel bad. I think it's okay.
Speaker 4: And of course you know he there's a reason why
Speaker 4: he's moved on, and so he you know, he came
Speaker 4: on stage and he said, we want Europe, and you
Speaker 4: give your speech, and there was a debate whether Germany
Speaker 4: was responding appropriate to the to the young French president
Speaker 4: who was doing that. But I think he was always
Speaker 4: this good European and I think we're very lucky to
Speaker 4: have him actually as a European. Also if you think
Speaker 4: about the latest developments in your country, if I may
Speaker 4: say so, mister president, and also in our country. And
Speaker 4: I think the ultimate problem always in the end, and
Speaker 4: you alluded to that in the previous round on AI
Speaker 4: either just to the two or the European industrial policies,
Speaker 4: that there's still no European answer to many of these things.
Speaker 4: And if you know, an industrial policy and deregulation and
Speaker 4: drug report makes that point and is Europe really ready
Speaker 4: to give more power? You always also talked a lot
Speaker 4: about the governance of Europe, and you know the way
Speaker 4: we are organized with Commission and counsel and very powerful
Speaker 4: national leaders, and that is a fundamental issue which I
Speaker 4: think makes it very difficult. But I think this is
Speaker 4: something which in the end is going to be again
Speaker 4: a very important issue. So I think that is something
Speaker 4: which is But I think that the Dragon reports on
Speaker 4: the common debt, this is where I was getting here.
Speaker 4: I think if I may say that, then you're closer,
Speaker 4: of course than I am. I don't think it is.
Speaker 4: The problem is not the common debt per se, But
Speaker 4: I think it is that you want to make sure
Speaker 4: that the money is spent properly and there's no moral
Speaker 4: hazard with it. We discussed this long time, many many times.
Speaker 4: So I think it requires also certain governance. For example,
Speaker 4: you think about the Defense Union. I think if you
Speaker 4: want common debt on the defense, you also need competencies
Speaker 4: at the European level because you have to have the
Speaker 4: decision power and the debt really hand in hand. So
Speaker 4: I think the common debt is easier once you give
Speaker 4: more of the governance also to the impavement. But that's
Speaker 4: really a difficult issue. So I would you know, and
Speaker 4: I think this is an ongoing process, but I think
Speaker 4: what you're saying makes sense. But I think in the end,
Speaker 4: the big disadvantage of Europe is really I mean, i'd
Speaker 4: be interested in what you think is that we really
Speaker 4: don't have in many of these areas this European vision
Speaker 4: which you of anybody has actually he does, yes, but
Speaker 4: it's not easy in Europe, you know, with and even
Speaker 4: if I may say so, if Germany and France. You
Speaker 4: said on Capitol Market Union in Meserbach, you have a
Speaker 4: paper which took us I think ten years or something
Speaker 4: to get a French and a German position on that.
Speaker 4: Then the question is also is the rest of Europe
Speaker 4: going to fall in line? That's also an interesting question
Speaker 4: because they're getting more competent and more confident as well.
Speaker 4: So the leadership of Germany and France is very very important.
Speaker 4: I think the only way actually to move Europe forward.
Speaker 4: I think that's also your view. But are the others
Speaker 4: then also in the future more likely to fall in
Speaker 4: line in terms of moving Europe forward?
Speaker 7: Those are Can we move on just because you have
Speaker 7: Maybe it took ten years to have Franco German agreement
Speaker 7: on that, but we've only got a few days to
Speaker 7: have Franco German agreement on the tariffs on Chinese electrical vehicles,
Speaker 7: and you mentioned it in your speech.
Speaker 5: On this stage.
Speaker 3: A year ago, actually I spoke to Chancellor Schultz who
Speaker 3: said he didn't want to see a trade war with China.
Speaker 3: He didn't like tariffs. His minister earlier said something quite similar.
Speaker 3: But there is a vote on whether those tariffs go
Speaker 3: through on Friday, so can I just ask do you
Speaker 3: think that will pass, that the EU governments will confirm
Speaker 3: those tariffs.
Speaker 2: I don't know before the vote. I can tell you
Speaker 2: that I do supports the European Commission on that because
Speaker 2: what I was speaking about electrical vehicles on the European market,
Speaker 2: and what is a reality. You have the European car makers,
Speaker 2: they go to the market and by the way, we
Speaker 2: use our taxpayers money to subsidize the consumer to buy
Speaker 2: these cars, and they have to compete with some car
Speaker 2: makers producing in China with an existing advantage. But it's
Speaker 2: part of the offshoring production because they produce in much
Speaker 2: lower cost condition. But on top of that they benefit
Speaker 2: from subsidies from the Chinese government. This is a bias
Speaker 2: for your market. I think this is the question is
Speaker 2: which model do you choose? Do you want to be
Speaker 2: a consumer or a producer. And now this dilemma we
Speaker 2: have twenty years ago for solar panels, we decided to
Speaker 2: kill our markets and we exactly we had the same dilemma.
Speaker 2: We did choose. We killed our industry. We had an
Speaker 2: existing industry, we killed it, and we had we deployed
Speaker 2: solar panels in a lot of places Chinese once, so
Speaker 2: we created a dependency which could create some problem. We
Speaker 2: experience that in COVID time, and we killed the ability
Speaker 2: to produce on the European soil. It's not a good
Speaker 2: idea when you need growth and you have to finance
Speaker 2: such a social model as the one we have now.
Speaker 2: The question is do we want a fair competition or not.
Speaker 2: I don't want a fair competition. So the EU Commission
Speaker 2: launched precisely a series of studios exchange with all the
Speaker 2: car makers and just correct the level of discrepancies to
Speaker 2: establish the level playing field, so you have something from
Speaker 2: nine to ten for those who are less helped. And
Speaker 2: I think the range is between twenty one and thirty
Speaker 2: five percent tariffs for these car makers. But with evidence
Speaker 2: and figures which could be which way exchanged with the
Speaker 2: car makers and will be exchanged with the Chinese industry.
Speaker 2: We already have retaliation. By the way, I can speak
Speaker 2: with a clear of you because it's on Cognac, nothing
Speaker 2: to deal with with with the car and I can
Speaker 2: tell you that Cognac was never held by the French government,
Speaker 2: so which means it is a pure retaliation. But this
Speaker 2: is a matter of credibility for our market, and I
Speaker 2: insisted that if you don't preserve the love of the
Speaker 2: playing field, just don't hope that you want to produce
Speaker 2: and preserve your industrial foot print in your hope.
Speaker 5: You spoke to Chancellor Shows earlier.
Speaker 2: I think.
Speaker 5: Did you make progress?
Speaker 3: Unfortunately you didn't even have any advisers in the room
Speaker 3: and the reporters were unable as no chance of us
Speaker 3: finding out.
Speaker 2: So and I do respect all the positions and the
Speaker 2: sensitivity of the market. I think the question is what
Speaker 2: will become the Chinese market for the for the carmakers.
Speaker 2: My view is that it did change during the past
Speaker 2: few years and it should not be underestimated. This market
Speaker 2: is not just a market open to our carmakers. You
Speaker 2: can deploy through GVS good operations, but this is much
Speaker 2: more competitive than it was a few years ago. Chinese
Speaker 2: carmakers are super competitive and sometimes better than we are.
Speaker 2: And this is a market in other capacities. And if
Speaker 2: we don't protect but just restore the condition of level
Speaker 2: playing field, we will be the adjustment zone of the
Speaker 2: other capacities. Because the US just put a one hundred
Speaker 2: person tax one hundred person tax undifferentiated, so let's wake up.
Speaker 2: We live in the same world. You cannot have China
Speaker 2: over subsidizing a lot of countries, even India and others
Speaker 2: reacting to these subsidies, the US overreacting by one hundred
Speaker 2: person Tife and the odd thing. You're welcome and it
Speaker 2: doesn't fly. Otherwise we will be happy consumers of non
Speaker 2: European producers. I can tell you we would have an issue,
Speaker 2: of course in a few years time.
Speaker 3: How important is it to have Europe You spoke about
Speaker 3: the importance of Europe speaking with one voice in order
Speaker 3: to get one voice on this would you be would
Speaker 3: you agree to a delay or some kind of compromise
Speaker 3: or you think I want.
Speaker 2: To be efficient and find compromise and respect all the positions.
Speaker 2: I think the I want to advocate the CEO commissions
Speaker 2: they did a great job. It was both to do
Speaker 2: so honestly, because they had a lot of pressure not
Speaker 2: to do it. And in the DNA of the Commission.
Speaker 2: You know that you work there, Larsendric, doing years. It
Speaker 2: was not in the DNA of the European Commission to
Speaker 2: work on this type of issue. And I think it's
Speaker 2: for me. This is a signal that clearly we have
Speaker 2: a strategic a much more strategic and geo strategic commission
Speaker 2: as we wanted then before. But clearly I want to
Speaker 2: insist in that we are not just a market of
Speaker 2: consumers and we were used just to behave following these
Speaker 2: nine and this is not a good idea and we
Speaker 2: will have exactly the same issue on still industry. I
Speaker 2: believe that on still industry we are much more aligned
Speaker 2: with the Chancellor in Germany. I do believe. I'm sure
Speaker 2: that on capital market union simplification we are very much online.
Speaker 2: So I want to insist on the fact that there
Speaker 2: is a very strong Forcal German alignment. Here is an
Speaker 2: issue very sensitive for some key players in your country.
Speaker 2: What I do respect. So the work has to be
Speaker 2: finalized with European Commission and I'm optimistic. But today and
Speaker 2: Arsdrig was right to mention it. We worked very hard
Speaker 2: with Chancellor shots on these issues and I mean it
Speaker 2: is very much aligned on capital market union simplification, a
Speaker 2: bit to invest much more public and private money and
Speaker 2: as well being much more reactive to protect our still
Speaker 2: industry or chemical industry. So you have a strong Franco
Speaker 2: German alignment set.
Speaker 3: You talked about protectionism as an ugly word, and that
Speaker 3: it's about having a different strategic and more realistic strategic vision,
Speaker 3: as the US does and certainly as China does. I
Speaker 3: wonder if, at the same time as having these tariffs
Speaker 3: for a level playing field, if you were to support,
Speaker 3: for example, finally moving ahead with Mercasore, would that send
Speaker 3: a message to other parts of the world that Europe
Speaker 3: is still open for business, that this is a specific
Speaker 3: thing with China, But actually Europe is still very much
Speaker 3: open to trade deals.
Speaker 2: I'm in favor of any deal which will be fair.
Speaker 5: Does it look fair right now?
Speaker 2: Why? Because exactly the same reason level playing field. You
Speaker 2: cannot impose a bunch of regulation to your industries and
Speaker 2: your farmers that they are digesting by the way, because
Speaker 2: it's not yet completed, and at the same time open
Speaker 2: to economies totally designed with this regulation, How do you
Speaker 2: want to explain to a farmer that it will be
Speaker 2: it will not be allowed to use this pesticide, this
Speaker 2: chemical ingredients and so on. And at the same time
Speaker 2: on ease sector you say you are more than welcome,
Speaker 2: you can come with your food without respecting the same world. Honestly,
Speaker 2: I I never advocate regulation that I don't understand myself,
Speaker 2: and I think this is a good rule and don't
Speaker 2: be naive. We speak about Merco Shore Brazil just imposed
Speaker 2: tariffs for if It as well, and in the care system.
Speaker 2: They want to exclude public procurement for the deal from
Speaker 2: the deal. They protects themselves, the protect the economies. And
Speaker 2: my point is just we I think a lot of
Speaker 2: people in Europe underestimated what happened during the past two
Speaker 2: to three years. But we had two huge shocks which
Speaker 2: could completely change our approach. I and war in Ukraine,
Speaker 2: the end of our energtical model and the end of
Speaker 2: the WT or order I love Andngzi. I am a
Speaker 2: strong advocate of the W two. To understand me, but
Speaker 2: just for the first time in our recent histories, the
Speaker 2: US decided not to be compliant with the W two
Speaker 2: for clintech. But this is two huge change. If we
Speaker 2: stay and stick to the same policy we are, we
Speaker 2: have no chance. And just look at the real location
Speaker 2: of so many industries, so many part of our industries.
Speaker 5: Just to follow briefly on Maca.
Speaker 3: So because after you saw him, I think Chancellor Shows
Speaker 3: gave a spe each today where he was proposing a
Speaker 3: sort of Mercasare light that that the EU specific bit
Speaker 3: of Mercasore, which doesn't involve some of the investment guarantees
Speaker 3: and things which involve government needing to all agree. So
Speaker 3: I just wondered, is that something that you would support
Speaker 3: or would be resigned to that.
Speaker 2: Happens without perfectly understand it is?
Speaker 3: It is the bit of the Mercasore deal that has
Speaker 3: been negotiated that only involves I think Lars Henry will
Speaker 3: be an expert.
Speaker 6: You can understand.
Speaker 5: Well, I can only continue to.
Speaker 6: Express strategically not understanding.
Speaker 5: I can be very clear.
Speaker 2: I'm afraid to understand.
Speaker 3: Well, the truth is it could happen without you, that's no.
Speaker 4: But I mean, I mean, you know, you know there's
Speaker 4: a you know, sorry way, there's all these trade deals
Speaker 4: have an EU part, EU only part, and then they
Speaker 4: have something usually investment, which is national that has to
Speaker 4: be approved by all national governments. And if you split
Speaker 4: this and just to the EU part, it only has
Speaker 4: to be ratified by the European Council. But because France
Speaker 4: is in the European Council and without France is not
Speaker 4: going to be ratified.
Speaker 6: So if he doesn't agree, why.
Speaker 3: Is your chancellor suggesting today that you just move ahead
Speaker 3: with the EA that micro feels this way.
Speaker 4: Well, yeah, I mean he still has to work with
Speaker 4: France obviously, even if it's EU only, but he will
Speaker 4: avoid going through all the national parliaments.
Speaker 6: But let I mean, but you know that.
Speaker 2: Carey, I mean favor. We negotiated and not even notified
Speaker 2: a lot of trade dealdering the past few years. I
Speaker 2: mean set with Canada, with Chinese, Chile, New Zealand and
Speaker 2: some others, and these one are a good example of
Speaker 2: those where we integrated the climate change issue because Paris
Speaker 2: agreements if you implement it, and this is what we
Speaker 2: decided to do, and I think we're right, it's sustainable
Speaker 2: if you use the fact that you I mean, we
Speaker 2: don't use our capacity to put pressure on our partners,
Speaker 2: given the fact that we are a market on more
Speaker 2: than four dred million consumers. But if you decide to
Speaker 2: push your producers to make a move to be compliant
Speaker 2: with perase agreement, which I do support, we have to
Speaker 2: do two things at the same time, not just constraints
Speaker 2: with milestones and new regulation. You have to invest to
Speaker 2: help them companies our households and to make the change
Speaker 2: acceptable and to preserve precisely part of their competitiveness. And
Speaker 2: at the same time you have to use that to
Speaker 2: make it a strategic instrument of your industrial policy. Otherwise
Speaker 2: you have always to choose between climate sovereignty and an industry.
Speaker 2: You can reconcile them if you are ready to use
Speaker 2: it as a bargaining poorer. Don't you think that countries
Speaker 2: are interested to have better access to the European market.
Speaker 2: For sure, it's an instrument to create incentives for them
Speaker 2: to be compliant and have the same level of regulation
Speaker 2: than we have on these key issues. Otherwise, I can
Speaker 2: tell you in the years to come, you will have
Speaker 2: a majority to stop with the climate change agenda, and
Speaker 2: people with dismant will dismantle the carbon neutrality agenda for sure,
Speaker 2: because it's just it is not compatible. And I'm sorry
Speaker 2: to say that, but in Marcosio it since you have Argentina.
Speaker 2: When I hear the friend I've got relation with President Milay,
Speaker 2: but I don't hear somebody with total is convinced by
Speaker 2: the climate agenda and wants to deliver. A matter of fact,
Speaker 2: and two years ago in Brazil we had complete a
Speaker 2: skeptical guy on climate change. This is matter of fact,
Speaker 2: So I'm totally in favor of trade. I think we
Speaker 2: live in an open world. It provided a lot of
Speaker 2: growth during decades in awaconomy. I think we have. It's
Speaker 2: part of the change of our own ya. Just wake
Speaker 2: up bus US and China. They do protect their market,
Speaker 2: they do subsidize their economy. They do invest much more
Speaker 2: than we do buss public and private innovation. So we
Speaker 2: have to adapt ourselves.
Speaker 3: One of the big features of your presidency in the
Speaker 3: first few years, President Macaun was that strength at home
Speaker 3: gave you strength in Europe. You made decisive reforms the employment,
Speaker 3: many other things. You've got the fiscal house in order,
Speaker 3: and that gave you the power to push things through.
Speaker 3: I think many people here will be looking at the
Speaker 3: time what has happened in the last few months in France,
Speaker 3: the fragility of the new government under Monsieur Balny, and
Speaker 3: wondering whether you still have that capacity to push through change.
Speaker 3: Do you worry that it was a mistake to call
Speaker 3: that election.
Speaker 2: No, I don't think so. Why because it never happened
Speaker 2: without a coaptation in France to be re elected. So
Speaker 2: I'm very lucid about my situation and we had a
Speaker 2: relative majority without any partners, so I called for snap
Speaker 2: elections for this reason. After two little bit more than
Speaker 2: two years, well we delivered. I mean, during the past
Speaker 2: two years we delivered the reform of indignification of unemployed people,
Speaker 2: a pension scheme, reform, an immigration reform. I mean, when
Speaker 2: I look around in Europe, I don't see a lot
Speaker 2: of countries deploying such a reform agenda. So we were
Speaker 2: under pressure, and I was very clear on the fact
Speaker 2: that when you have the far right more than thirty
Speaker 2: five persons, you cannot follow up during three years to come,
Speaker 2: because I had three years to come without making a move.
Speaker 2: But I think you should not see that as a
Speaker 2: source of instability. The reaction of the French people was
Speaker 2: the opposite, because if they had confirmed the thirty five
Speaker 2: percent for the far right and what a lot of
Speaker 2: people thought, I would have a far rightists prime minister.
Speaker 2: Today it's not a case. So what we had for
Speaker 2: the first time in our history, which is much more
Speaker 2: the custom in your country and a lot of European country,
Speaker 2: is a fragmented parliament. Fine, this is less our culture
Speaker 2: to have cooperation between the parties. This is my problem,
Speaker 2: so I'm trying to create this dialectic work between the
Speaker 2: parties to work together. It's not a natural move, but
Speaker 2: I'm reasonably optimistic about the fact that reasonable social Democrats,
Speaker 2: Centrists and reasonable writers can work together for the years
Speaker 2: to come to deliver strong agenda. And what we have
Speaker 2: to do is first to preserve and digest all the
Speaker 2: reforms we delivered during the past seven years, and we
Speaker 2: have to deliver more for our young people. We have
Speaker 2: to complete what we did on apprenticeship to have a
Speaker 2: better and faster access to the markets. It's one of
Speaker 2: the key points for the French system to have more growth.
Speaker 2: We have to follow up what we did on the
Speaker 2: unemployment system. We have to work on the access to
Speaker 2: our labor market for senior workers, and we have a
Speaker 2: lot of sectorial reforms to be launched. We have in France.
Speaker 2: This is our chance, the ability even with a relative majority,
Speaker 2: to deliver these reforms of the parliament. But I think
Speaker 2: we can create dynamic and I do trust mister Banneer's
Speaker 2: government to be in this situation to deliver useful reform
Speaker 2: for the countries. Because the agenda is quite clear. We
Speaker 2: have to modernize the country. To be part of this agenda,
Speaker 2: we have to deliver the European scale and at the
Speaker 2: same time we have to make more effort on social
Speaker 2: coasion and stability of the country. This is normal in
Speaker 2: the lifetime of the country after seven years, so I'm
Speaker 2: totally elucid about that and optimistic. But I want to
Speaker 2: focus on the fact that today the key points of
Speaker 2: the reform agenda for me is at the European scale.
Speaker 2: I think we put in place a lot of reforms
Speaker 2: that now we have to deliver, and we have to
Speaker 2: deliver in concrete terms. We have less lows to be
Speaker 2: passed and what points in the pension scheme is for
Speaker 2: the years to come and it's already voted, but the
Speaker 2: key elements are to be decided at the European scale,
Speaker 2: and I think if we want to improve our growth
Speaker 2: both in Germany and France, for me, the top of
Speaker 2: my priority are at the European scale. So this is
Speaker 2: a sort of reverse agenda if you compare with twenty
Speaker 2: seventeen twenty twenty, is that today we have to focus
Speaker 2: much more on how to simplify at the European scale,
Speaker 2: how to accelerate on the energy market, how to accelerate
Speaker 2: our financial services at the European skate. So I will
Speaker 2: indicate much more energy at the skate because this is work.
Speaker 2: We can unlock a lot of growth and potent shils.
Speaker 3: But Las Henric, when you have a country coming to
Speaker 3: these discussions that has a six percent of GDP budget deficit,
Speaker 3: as France now has one hundred and ten percent debt,
Speaker 3: is having to have an extended period to get back
Speaker 3: within the convergence criteria, that is not a strong negotiating position.
Speaker 6: You mean that country has that country being front.
Speaker 4: I don't think that negotiation position of France depends on
Speaker 4: the on the budget deficit. I think there's more to
Speaker 4: that than just that one. And I think that the
Speaker 4: European rules, I think on the deficit criterion, which have
Speaker 4: been adjusted actually as the Minister was saying yesterday, very
Speaker 4: much in line actually with a German debt rule. So
Speaker 4: there's not that much difference here, and I think it
Speaker 4: should be it should be applied, and I think, you know,
Speaker 4: I think generally there's a question of debt in the world.
Speaker 4: I mean, if you look at the US economy, they're
Speaker 4: very much you know, over debted and if you look
Speaker 4: at both sides of the aisle, all of it is
Speaker 4: more spent, lower taxes, more subsidies, in some cases tariffs,
Speaker 4: which are also not going to necessarily increase growth. So
Speaker 4: I think the problem of debt in the world, I
Speaker 4: think is an issue, and I think Europe needs to
Speaker 4: be careful of, you know, having having prudent fiscal rules
Speaker 4: and stimulus, and I think that's important. But I think
Speaker 4: I agree with Aman with President Macrant that it is
Speaker 4: much more of a European issue. I think the future
Speaker 4: of Europe than it is a domestic French one, as
Speaker 4: he has done a lot of the reforms when he
Speaker 4: became president. I think labor market reforms, many of the
Speaker 4: things you have done and I don't you know, and
Speaker 4: I think they're the regulatory are more important than the
Speaker 4: dead issues.
Speaker 2: I mean to be just to highlight the point and
Speaker 2: make it clear why are we in the situation. We
Speaker 2: had an issue during the low growth this year, so
Speaker 2: we have less written on our budget in terms of taxes.
Speaker 2: This is why we have this discrepancy with the forecast.
Speaker 2: And we had a difference in terms of focus with
Speaker 2: some public expenditure at the local level, but more than that.
Speaker 2: To understand the French metrics we started to diverge in
Speaker 2: the eighties because we build progressively a much more generous
Speaker 2: social model. The main factor of adjustment if you take
Speaker 2: our balance sheet, I would say is clearly pension reforms
Speaker 2: and healthcare system. This is a big bunch of where
Speaker 2: we have discrepancies, and especially as well because in terms
Speaker 2: of public expenditure we have so we have a social
Speaker 2: model where it's one hundred person through the budget of
Speaker 2: all the public administrations. This is why it was a
Speaker 2: necessary to pass this pension reform. And I mean the
Speaker 2: figures and the negotiation we'll see, but probably in the
Speaker 2: next mandates my successor will have to pass another one
Speaker 2: if they want to adjust. But the main focus and
Speaker 2: I put my energy on one point, how to create
Speaker 2: more activity? Because why did we accumulate so many deficits
Speaker 2: and debt in the French model. This is because we
Speaker 2: never fixed the mass unemployment. And during the past seven years,
Speaker 2: because of our tax reforms, because our label laws reforms,
Speaker 2: because our attractiveness agenda, we've been the number one country
Speaker 2: in terms of attractive net during the past five years,
Speaker 2: we created more than two million jobs. When we decreased
Speaker 2: even with COVID, even with the cranins are by more
Speaker 2: than two points. Our unemployment rates, so we are a
Speaker 2: converging and this is the main topic because if we
Speaker 2: had the same level of activity as Germany, we will
Speaker 2: don't have public deficits and it's much smarter to look
Speaker 2: to work on that than being obsessed by a short
Speaker 2: term adjustment, which is a killer for growth. The top
Speaker 2: priority of the French economy should be how to be
Speaker 2: sure that to improve the activity rates of young people
Speaker 2: because we have I think two to three points less
Speaker 2: than Germany. Your system is more efficient we start. When
Speaker 2: I was elected, we had two hundred and fifty thousand
Speaker 2: apprentices per year. We have nine hundred thousand. We are
Speaker 2: converging with the German model. We still have some work
Speaker 2: to be done at the university to better are located
Speaker 2: off of training, but this is a primittee. Second reducing
Speaker 2: unemployment rate again because we are not yet at the
Speaker 2: German level, so we have to continue the reforms and
Speaker 2: improve the rate of access of activity of senior workers
Speaker 2: because we have two to three points less than Germany
Speaker 2: as well. And part of the explanation of these points
Speaker 2: is the fact that we have not the same retirement age.
Speaker 2: So the key drivers as is ones. Let's be clear.
Speaker 2: So yes, you need political courage and you have to
Speaker 2: be fair with your people. But solution is not to
Speaker 2: have a short term adjustment by cutting some social expenditure
Speaker 2: because it's super hard without any agenda, or over taxing,
Speaker 2: because we don't have a lot of room to maneuver
Speaker 2: in terms of taxation given the fact that we are
Speaker 2: number one or two. It depends with Denmark in Europe.
Speaker 2: Here's the gender.
Speaker 3: I mean the cults that are being proposed, we had
Speaker 3: them a little bit today that just for next year,
Speaker 3: to make Monsieur Barney's numbers add up, we have a
Speaker 3: squeezing of the of the deficit by sixty.
Speaker 5: Billion euros exactly.
Speaker 3: Next year, some of which will be taxes on wealthy
Speaker 3: individuals and big businesses. There are any higher taxes that
Speaker 3: you would.
Speaker 2: Say will discuss that. I think having an exceptional taxation
Speaker 2: on corporate is something which is well understood by large companies.
Speaker 2: If this is for one year, given the level of
Speaker 2: effought which should be made, but it should be limited
Speaker 2: and we don't have to forget I mean, we have
Speaker 2: not to forget the reality of our economy, the reality
Speaker 2: of our competitiveness and our position. Just take an OCD comparison.
Speaker 2: We are number one or two in terms of taxation.
Speaker 6: We are.
Speaker 2: Not in the best year in terms of level of
Speaker 2: activity and how working participation or how to be worked
Speaker 2: per year. So this is what we have to improves.
Speaker 3: But as you say, the most important things that you
Speaker 3: can do for the long term is the reforms like
Speaker 3: the pension reform, and that is another reason why people worry.
Speaker 3: They look at the cost of the uncertainty of the
Speaker 3: last few months and you say that the far right
Speaker 3: threat has been contained with this new arrangement. But Marie
Speaker 3: Le Penn wants to reverse that pension reform and tomorrow
Speaker 3: she could call a confidence vote and probably bring down
Speaker 3: the government over that. So do you think that there
Speaker 3: will be opposition, will be an effort to overturn the
Speaker 3: pension reform.
Speaker 2: I think when you look at the figures and you're
Speaker 2: sincere with people, all the reasonable parties will look at
Speaker 2: the fact that this pension reform and these chymetris has
Speaker 2: to be preserved. And we have a structure with all
Speaker 2: our unions, and this structure now is very clear and
Speaker 2: issued figure that it was a necessity to do so,
Speaker 2: and after a dissolution you cannot change to parliament during
Speaker 2: at least one year time. But I want What I
Speaker 2: want to tell you is, at first I ask the
Speaker 2: reality and the pricing of uncertainty by calling for these
Speaker 2: nap elections. If I did not ask for this election,
Speaker 2: I could be in front of you and you would
Speaker 2: tell me, Okay, you cannot go the next you cannot
Speaker 2: go for election in two and a half years. Look
Speaker 2: at this course. They are air and they were in
Speaker 2: a situation to call for a confident vote and force
Speaker 2: me for a dissolution, and I wouldn't answer. Now we
Speaker 2: were bold collectively, I took my responsibility. I asked the
Speaker 2: firm people, do you want them to go to govern
Speaker 2: They answered very clearly no. Eleven million of my people
Speaker 2: did vote for them. So it means that there is anger, fears,
Speaker 2: and clearly some top priorities that we have to face
Speaker 2: on security, on social justice on the ground, the situation
Speaker 2: of poor neighborhood and so on, rural areas and so on.
Speaker 2: So this is the agenda we will have to fix that.
Speaker 2: The government as in front of him, but they didn't
Speaker 2: give the floor to them, and look at the situation
Speaker 2: everywhere in Europe. Look at what happened in Austria, look
Speaker 2: at what happen in Nezerlands, look at what happen in Italy,
Speaker 2: look at what's happening in a love of Leander in
Speaker 2: your country. So this is why I'm a strong advocate
Speaker 2: of EU growth agenda, because this is the only way
Speaker 2: to give a return to our middle classes. Otherwise this
Speaker 2: is a killer for them, and this is the only
Speaker 2: way to reconcile economy and the reality of politics. But
Speaker 2: don't you think that having farmers to which you ask
Speaker 2: for reforms and efforts, and at the same time you
Speaker 2: explain I will welcome the sawyer been coming from Mercursire
Speaker 2: is the best way to kill the far right. I
Speaker 2: can tell you for my country, not at all. And
Speaker 2: at the end of the day, do you think what
Speaker 2: is the priority today for all of us? Delivering growth
Speaker 2: and political stability, fixing the society of our societies, and
Speaker 2: convincing reasonable people and our middle classes not to go
Speaker 2: to the extremes. But let's be clear, didn't we deliver
Speaker 2: collectively good policies for our middle classes during decades we
Speaker 2: delivered good policies to have the maximum of exports, the
Speaker 2: maximum of profits, but they have a feeling sometimes for
Speaker 2: good reasons. They were the adjustment factor of our economy.
Speaker 2: This is why preserving level playing physics not just sacrifying
Speaker 2: a lot of pieces of our economy where the middle
Speaker 2: classes work. I try to be consistent.
Speaker 5: You've been very clear.
Speaker 3: I want to get onto a question from some of
Speaker 3: the young people here, but just to very quickly follow
Speaker 3: on on that, because you have defended very clearly why
Speaker 3: you took that decision to call the election in the summer,
Speaker 3: and at the time you said it was for clarity,
Speaker 3: and I guess some people would say you didn't get
Speaker 3: the clarity. But would you make the same decision again, Yes,
Speaker 3: because I sat in the next two years.
Speaker 2: No, no, no. My view is that we have to
Speaker 2: preserve now till the end of my mandate. But it's
Speaker 2: important because this is a new phase of the political
Speaker 2: modernization of France as well. I was elected in twenty
Speaker 2: seventeen in this commitment precisely to go beyond the party system,
Speaker 2: and I gathered with me people coming from the left,
Speaker 2: the right, in the center on a common project. And
Speaker 2: now the question is how to work collectively with not
Speaker 2: just my party but other parties. This is a new
Speaker 2: way to move forward at the Parliament. But this is
Speaker 2: a very positive one for me, and this is the
Speaker 2: only one to provide stability and not to be precisely
Speaker 2: super sensitive to the extremes. At the same time, we
Speaker 2: need bold reforms and the agenda has to be bold,
Speaker 2: and the Prime Minister was right to push some key
Speaker 2: items of this agenda. And I know that a lot
Speaker 2: of men is us will will advocate for very important
Speaker 2: reforms from economic, social and and and and and from
Speaker 2: a first point of view. But for me, we are
Speaker 2: just building something. But look at the situation, nothing was sacrificed. Also,
Speaker 2: reforms are preserved and this new government has to work
Speaker 2: with parliament and progressively will build consensus. So I'm I'm
Speaker 2: not naive, I'm a resonantly optimistic, but I think at
Speaker 2: the same time we have to accelerate to deliver a
Speaker 2: positive view agenda.
Speaker 3: Lars Hendrik, the President, has spoken very clearly about how
Speaker 3: he saw the challenge presented by the fact that you
Speaker 3: had a third of the population potentially or voters voting
Speaker 3: for the far right. Do you think I mean that
Speaker 3: is obviously an issue here. Do you think it's realistic
Speaker 3: for the center to continue to lock out the extremes
Speaker 3: of in European politics?
Speaker 4: I think this is a big issue right now also
Speaker 4: in this country, in Germany, and if you look at
Speaker 4: some of the elections you recently had in the Lenda
Speaker 4: is a challenge. But I do think, you know, I'm
Speaker 4: not a politician, but I do think not having them
Speaker 4: part of the government to sort of disenchant them or
Speaker 4: you know, show how they cannot do it, I think
Speaker 4: that's the wrong strategy.
Speaker 6: I think you should not have the main part of
Speaker 6: the government.
Speaker 4: I think the government has to deliver, and as you're saying,
Speaker 4: I think showing to the people that you know, the
Speaker 4: growth and the economy and you know, inflation and healthcare
Speaker 4: and all these kinds of issues are solved.
Speaker 6: I think that's the.
Speaker 4: Way to get the people to vote for you, because
Speaker 4: I don't think in Germany when it's thirty or more
Speaker 4: percent of the people and vote for parties which are
Speaker 4: very extreme. I don't think these people are very extreme.
Speaker 4: I think you need to, you know, deliver to them
Speaker 4: an important agenda and results and then they will vote
Speaker 4: for the right thing. So I don't think the strategy,
Speaker 4: but you're much much more of a politician here. To
Speaker 4: include them and then to show that they can't govern,
Speaker 4: I don't think that's the right strategy is also very risky.
Speaker 4: I think you need to do a good job as
Speaker 4: a politician and offer and show to the people that
Speaker 4: it's a good thing. So I think that's but I
Speaker 4: think that's what you were saying as well.
Speaker 5: I wanted to get to one of the should.
Speaker 4: Actually say if I may say so, it's going to
Speaker 4: say that in my closing statement that we had a
Speaker 4: survey by Egon Sina surveying business people around the world
Speaker 4: what is the biggest challenge.
Speaker 6: For you right now?
Speaker 4: And the number one challenge was nationalism and populism. So
Speaker 4: this is clearly also a business concern. So it's not
Speaker 4: good for the economy actually to have these kinds of results.
Speaker 4: So I think this is actually very important one.
Speaker 3: So one of the SMT students Global students, am I
Speaker 3: Yagmurova from Kazaks Down, has has a question.
Speaker 6: Madame Flander.
Speaker 8: Yes, as mentioned, my name is Emma. I'm a student
Speaker 8: here at SNC and I'm honored to be part of
Speaker 8: the Young Voices program.
Speaker 5: And our question is with.
Speaker 8: A little lead in may you argue that deeper integration
Speaker 8: within the European Union will strengthen EU ability to act
Speaker 8: on the global stage, but at the same time others
Speaker 8: fear that it undermines national sovereignty. In this regard, how
Speaker 8: do you envision balancing further integration within EU and addressing
Speaker 8: concerns about further European about national sovereignty.
Speaker 2: I thank you very much, by the way, I love
Speaker 2: your country. Look, I think there is a there is
Speaker 2: a way to move forward and and this dialma is
Speaker 2: very well known and I think is right. But I
Speaker 2: think we have to deepen the single market and we
Speaker 2: have as well to increase subsidiety. And this is a
Speaker 2: way to address this Dinama. When I say we have
Speaker 2: to deepen single markets energy, for instance, telco telecom operators
Speaker 2: and financial services. If you clearly deepen the single market,
Speaker 2: because on this three sectors you don't have an evil
Speaker 2: single market. It was out of the initial perspective. If
Speaker 2: you build a single market at the same time, if
Speaker 2: you alleviate as well as the burdens and the overregulation
Speaker 2: on healthscare, on some other and there is almost no
Speaker 2: impact on normal people because you just force people to
Speaker 2: adopt the same regulation. It's a lot of noise work
Speaker 2: and our full session for a lot of technicians and
Speaker 2: the industry everywhere in Europe, but there is no impact
Speaker 2: on the normal life. What makes people crazy with your
Speaker 2: and integration is when just you bother households on their
Speaker 2: normal life. Which is true, but this is a well
Speaker 2: known anecdote. But when you force an olive oil producer
Speaker 2: to be compliant with such a regulation, when you force
Speaker 2: to stop this geographical indication in this part of Italy
Speaker 2: and France to be compliant with this rule, when you
Speaker 2: force the hunter in one place not to do it
Speaker 2: there but to help you allow the other one. I
Speaker 2: mean this feeling which is the resentment of some part
Speaker 2: of our population to be blocked disrespected in the way
Speaker 2: of life by leaders and by Europe, is due to
Speaker 2: the fact that there is a sort of unadapted approach.
Speaker 2: We go too much in the ittegrity. So for me,
Speaker 2: we have to stop over regulating all the details of
Speaker 2: this way of life and focus on the big issues.
Speaker 6: We have.
Speaker 2: Our big we have much bigger issue than all these regulations.
Speaker 2: We did it for good reasons. But now we have
Speaker 2: to stop and digest. It went too far from a
Speaker 2: lot of these people. And I can tell you because
Speaker 2: I do agree with what you said on the reasons
Speaker 2: of the far right votes and nationalism. As you mentioned,
Speaker 2: sometimes it's about very tiny things, just they are fed
Speaker 2: up with this other regulation and because they are hurt
Speaker 2: in their day to the life. But it's totally compliant
Speaker 2: with deepening single markets in the critical areas because there
Speaker 2: is an impact on them. So my point is, let's
Speaker 2: focus on the big issues. Let's deepend single markets on energy,
Speaker 2: teleco financial services, Let's create an actual single market on
Speaker 2: AI and hydrogen. It's a super agenda for the years
Speaker 2: to come. It's already an immense agenda. And let's stop
Speaker 2: regulating on the nitty gritty and on the daily life
Speaker 2: for housulds, and we will count on the resentment on
Speaker 2: the feeding noting nationalism, and we will deliver concrete results.
Speaker 5: It's a president.
Speaker 3: I want to take you right back the final question.
Speaker 3: We've run out of time, but from where we started,
Speaker 3: which was the sense of urgency you had in your
Speaker 3: remarks that you felt everybody in Europe should feel about
Speaker 3: the challenges facing the European growth model, and as you know,
Speaker 3: often in Europe.
Speaker 5: It's a moment of crisis.
Speaker 3: It's when politicians are looking over the ledge that they
Speaker 3: actually have done things. Whether it's the global financial crisis
Speaker 3: or as you mentioned, COVID, the invasion of Ukraine, all
Speaker 3: of those things have forced changed. As an economist, I
Speaker 3: would think that the fact that the EU could be
Speaker 3: forty percent smaller than the US in twenty years time,
Speaker 3: if it carries on like this is a pit of
Speaker 3: a is a crisis, but it's a slow moving one.
Speaker 3: Will it take an outside force to force this kind
Speaker 3: of change? And I wonder in that context, with the
Speaker 3: return of Donald Trump as president, help you get some
Speaker 3: of this is down.
Speaker 2: Look, I think it could have consequence of the defense
Speaker 2: and security part of the agenda.
Speaker 5: For sure, good consequences.
Speaker 2: Consequences, but I think we should be honestly, I don't
Speaker 2: want to speculate on the US elections. My point more
Speaker 2: than that is that US is very strong partners. This
Speaker 2: is a very important lie. But whoever will be elected
Speaker 2: and whatever the administration is, I think we have to
Speaker 2: be lucid on our situation. Europe is normal. The top
Speaker 2: priority of the US. The US top priority is US,
Speaker 2: which is normal unfair. The second top priority is China,
Speaker 2: and for the rest it depends on the moment. They
Speaker 2: are super loyal and reliable partner. In Ukraine, will it
Speaker 2: class I don't know, but let's be clear. At the
Speaker 2: same time, in Afghanistan we didn't have the call before,
Speaker 2: and in the OCUS did. In Australia, I didn't have
Speaker 2: the call before, but it's not a reproach. I try
Speaker 2: to be lucid. The EU is not the priority of
Speaker 2: the US, and this is why part of the wake
Speaker 2: up call period of time we are living and part
Speaker 2: of what we have to completely reshape is our defense
Speaker 2: and security strategy. We are part of NATO no discussion,
Speaker 2: We are stronger lives of the US no discussion, but
Speaker 2: we have to derisk our model from the US agenda.
Speaker 2: This is why we have to invest much more for ourselves.
Speaker 2: We have to create much more European solutions. We have
Speaker 2: to preserve much more our financing for European solutions. This
Speaker 2: is the top priority. But what you say is very important,
Speaker 2: and this is why I try to be vocal and
Speaker 2: removed under the pressure of crisis. When they were perceived
Speaker 2: by our fellow citizens, the financial crisis and the COVID crisis.
Speaker 2: You are all here, business leaders, political leaders, intellectual leaders.
Speaker 2: Our responsibility, your responsibility, our collective responsibility if to explain
Speaker 2: our fellow citizens that this is a symmetric shock for Europe.
Speaker 2: They don't see now the results and the consequences. But
Speaker 2: our responsibilities is to pre empt the situation and to
Speaker 2: act now. Otherwise it will be a rescue plan in
Speaker 2: five to ten years time. It would be awkward. And
Speaker 2: we know the situation. The figures are clear, the trends
Speaker 2: are very clear. So our responsibility as leaders is precisely
Speaker 2: to say, okay, we feel the pressure and for me,
Speaker 2: Europe can make smart moves when we have symmetric shock.
Speaker 2: During the financial crisis, don't over estimate. We did react,
Speaker 2: but we didn't take automatically all the right decisions because
Speaker 2: it was an asymmetric shock. And we fix this crisis
Speaker 2: much more slowly than the US because we were precisely
Speaker 2: divided between north and south. It was a weakness. It
Speaker 2: was before bunking union and such a level of integration,
Speaker 2: but it wasn't asymmetric shock, meaning we didn't have the
Speaker 2: same interest. Today we can have in the nitty gritty
Speaker 2: some different interests. You are much more invested in car
Speaker 2: making business. Fine, which creates this kind of discrepancy, but
Speaker 2: in reality we are already aligned. Because it's already too late.
Speaker 2: If I'm fair, it's already too late. So we should
Speaker 2: be aligned and just look at the situation. Whatever our
Speaker 2: differences in the energy system could be or industrial system,
Speaker 2: this is a symmetric shock for the European societies and economies.
Speaker 2: So we have to precisely deliver this in depth reform
Speaker 2: on our governance, on security and defense and the growth model.
Speaker 2: If just we want to deliver for our people, this
Speaker 2: is the best way, buys the way to help all
Speaker 2: the countries precisely to limit and get rid of the
Speaker 2: extremes because they are just held by the recent amount
Speaker 2: of people and the lack of collective efficients.
Speaker 3: Ladies and gentlemen, you've had your marching orders from mister President,
Speaker 3: and I think we have we've run out of time,
Speaker 3: so thank you very much, mister President and Las Hendrick.
Speaker 6: I thank you very much.
Speaker 1: All right, you've been listening to an exclusive conversation with
Speaker 1: French President Emmanuel Macron at the Berwin Global Dialogue event
Speaker 1: hosted by our own Stephanie Flanders,