Below is the transcript of a CNBC Exclusive interview with Bruno Le Maire, French Finance and Economy Minister. The interview was first broadcast on CNBC’s Squawk Box Asia on 11 February 2019.
All references must be sourced to a “CNBC Interview’.
Interviewed by CNBC’s Hadley Gamble
Hadley Gamble (HG): Minister thank you so much for joining CNBC. I want to kick off by asking you about what we’ve seen happening in France over the last several months; the riots, the general chaos — can you ensure investors that France and your government have a handle on the situation.
Bruno Le Maire (BLM): I’m deeply convinced that Emmanuel Macron will overcome those difficulties. But we-; you have to take into account what happened in France and what happened in many other countries. You have a lot of people in the European nations which have the feeling to be left out of globalization, which do not take any benefits from globalization. We have to take that into account. So the first response, we put on the table, was this grande debate which means that everybody has to make proposals to improve the current situation in France. And after these big debate, Emmanuel Macron and the government will take very strong decisions. We have listened to the people and we will give strong answers to what has been expressed during the last two or three months.
HG: And given what we’ve seen over the last couple of weeks from the Italian government. Do you feel that they are betraying the ideals of Europe?
BLM: I think that Europe needs solidarity more cooperation and not that kind of nasty or aggressive remarks against each other. I think that the key challenge for Europe is to be a strong continent from both the political and economic point of view between the United States on the one side and China on the other side. We have to face the rise of China on the economic fields, but also on the political and financial fields. If we want to be strong we have to be together. Dividing Europe, dividing European politicians would be a historical mistake for all the European countries.
HG: Following on to that you’re headed to Brussels tonight. Don’t you think that should mean then that the Europeans should really help Theresa May when it comes to her Brexit negotiations. Because in terms of getting a clean Brexit here doesn’t that mean that there would be more solidarity between the UK and Europe.
BLM: The British people made a choice. I deeply regret the choice made by the British people to leave the EU and I strongly believe that it was a mistake. But this is a decision of the British people and we have to take that into account. We-; having negotiated an agreement, and I think that the agreement that is now on the table is a fine one, and a fair one. So it’s up now to the British politicians and to the British prime minister to find a way out and hope that the agreement might be accepted by the British people. For the 27 member states of the EU; the key question is not the Brexit – the key question is the future of Europe. The key question is how we improve the current daily life of European citizens. How do we find more funding for innovation, for new technologies. How we build up an industry that we’d be able to face the American and the Chinese industry. These are the key questions and, I must confess, Brexit is not the key challenge for us. The key challenge is the reinforcements of the European continent and the European construction.
HG: But Europeans; granted this isn’t necessarily perhaps your biggest challenge, but for Theresa May she’s between a rock and a hard place. Do you think that Europeans should then help her out or at least be open to the idea of it?
BLM: We are not in favor of any opening of the agreement because it took a lot of time to negotiate that agreement and I really feel that this agreement is the best agreements that we can achieve. So reopening the agreement would lead nowhere, and I think it would be like selling new illusions to the British people. We have that agreement, maybe there is a need for clarifications and we are open to giving more clarifications to a British citizen, of course, but we opening the agreement would lead nowhere.
HG: Right now a lot of people in Silicon Valley are very unhappy with Europe. They feel that they’re being unfairly targeted when it comes to taxation and the moves by the European Parliament to really tap down on what they think are unfair practices by these technologies and internet companies. What’s your take?
BLM: I think there is no unfair behaviour. The question of taxation is the key question for the 21st century. We have to look at the current situation in the current situation you have a small SMEs being more taxed than the biggest Internet giants in the world. We can no longer accept to have the smallest SMEs being taxed 40 points more than the Internet giants, that’s why France has decided to introduce a digital taxation for the internet giants, like Italy, like Spain, like the UK did. We hope that it will be possible to find a European agreement on digital taxation. For the sake of having a more efficient and fairer international taxation system. And there is another challenge which is a key one, we wanted to fight against tax avoidance from the biggest multinationals in the world and this will be one of the key priorities for the French G-7. We want to introduce a minimum level of corporate tax all over the world because we strongly believe that if we want to fight against tax avoidance we need the introduction of a minimum corporate tax levy.
HG: One of the things, of course, that’s hidden behind the problem that you’ve had in France over the last couple of months is of course rising inequality and people feeling that they’ve been unfairly played by the system. When you take a step back and look at the potential for the deal between Alstom and Siemens the EU said they’re not going to let that happen. Do you think that’s fair?
BLM: No, I think it was a mistake from the European Commission to refuse that merger between Alstom and Siemens. Let’s have a look at true reality. We are facing a huge challenge with the rise of the Chinese industry. What do we do? Shall we divide the open forces or shall we try to merge the open forces from the industrial point of view? I strongly believe that the right solution is not more division but more cooperation among French, German and other European companies. That’s exactly what we proposed with the merger between Alstom and Siemens to have industrial giant being able to face the competition with the so-called [in French], the Chinese giants in segmentation and raw stock. The commission took that decision. Of course we would abide by that decision but we would make very strong proposals to change the world of competition and to allow the European industrials to merge and to be stronger.
HG: Minister, final question for you – we’re right here inside the Middle East. Weapons Sales from France have doubled to the Middle East over the last year or so. Given what we’ve seen in terms of the situation in Syria, the destabilization of Yemen, the Khashoggi murder as well, do you believe that France will continue to sell weapons to the Middle East at the levels that we’ve seen.
BLM: First of all I would like to recall, that France under the leadership of Emmanuel Macron is doing a lot to restore order, to preserve peace in the region. We have soldiers on the ground and we made a lot of public expenses to support peace in the region. That’s the first point I wanted to recall, because I listened to critiques coming from countries which do not have soldiers on the ground. The second point is that there are rules when you want to export weapons. And France is abiding by the international and especially by European rules as far as weapons, exploitation are concerned.
HG: Do you think that public opinion might change that in the coming year?
BLM: I think that the public opinion wants to have protection and if you want to have protection you have to defeat terrorism on the ground. That’s exactly what France is committed to do.
HG: Your Excellency thank you so much for joining CNBC.
BLM: Thank you.
Communications Manager APAC, CNBC International
D: +65 6326 1123
M: +65 9852 8630
CNBC is the leading global broadcaster of live business and financial news and information, reporting directly from the major financial markets around the globe with regional headquarters Singapore, Abu Dhabi, London, and New York. The TV channel is available in more than 410 million homes worldwide.
CNBC.com is the preeminent financial news source on the web, featuring an unprecedented amount of video, real-time market analysis, web-exclusive live video and analytical financial tools.
CNBC is a division of NBCUniversal. For more information, visit www.cnbc.com