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French business to gain from Brexit, but Frexit menaces

Following the Brexit, the UK's closest continental neighbor faces its own political challenges. But the French are also poised to benefit should the UK lose access to the single market, Jake Cigainero reports from Paris.

Following the Brexit, the UK’s closest continental neighbor faces its own political challenges. But the French are also poised to benefit should the UK lose access to the single market, Jake Cigainero reports from Paris.
As Charles Dickens’ “A Tale of Two Cities,” about Paris and London, begins, “It was the best of times, it was the worst of times.” The same could be said after Great Britain’s decision to leave the European Union with a nearly 52 percent vote.

France, the United Kingdom’s closest continental neighbor, will have its own set of political and economic challenges in the days ahead: from losing Great Britain as a partner at the EU roundtable to the specter of its own Frexit referendum. But the French are also poised to benefit should the UK lose access to the single market.

Vivien Pertusot, of the international relations think tank Ifri, said the Franco-British political relationship had never been defined by the European Union, but is based on bilateral interests.

“That will not change,” Pertusot said. “It’s not like Germany, where the Franco-German relationship is extremely important as long as the EU is working well.”

Pertusot foresees a period of fluctuation because “for the French, being a part of the EU is extremely important, almost vital – so if you’re not part of it, you’re a different kind of partner.”

Despite EU-wide uncertainty after the vote, French businesses have their eyes on new potential economic opportunities the Brexit offers. When the Brits walk away, they lose access to the common market and “passporting” services, a privilege that’s key to the success of London’s powerhouse financial industry.

France could strengthen its financial services sector. “They will want to get some pieces of the cake,” Pertusot said, “because some companies will export some of their activities out of London to remain part of the single market.”

As for France’s exports, the dairy and wine industries are particularly worried about what Brexit means for business, as reinstated tariffs will drive up prices and could reduce UK imports.

In addition to any impact on trade, Pertusot said, the Brexit will especially have an effect on foreign policy and defense for France and the European Union.

Pertusot called France and Britain the most forward-thinking nations when it comes to strategy, foreign policy and defense. “The French will now feel slightly alone in the big room with 26 other member states who look at things with a more distanced eye,” he said.

As for refugees – an issue that “Leave” campaigners had hammered hard to drum up votes – French center-right Economy Minister Emmanuel Macron had previously said Calais would no longer hold migrants in the event of a Brexit. But Macron’s statement was just an empty threat, and Interior Minister Bernard Cazeneuve said France would uphold its end of the 2003 Le Touquet treaty, which covers the movement of people across the channel.

‘Begun to disintegrate’

France had its own day of union reckoning in 2005, when voters rejected an EU-wide constitutional treaty. Could a Frexit be next?

Marine Le Pen, of the far-right National Front party, has long been an advocate of ditching the euro currency and has already said that France needs to follow Great Britain’s lead and get out of the EU. Le Pen is expected to reach the second round of next year’s presidential elections and says France isn’t the only country that should have a referendum: She wants all EU members to go to the polls.

Ahead of the Brexit referendum, Herve Mariton, who is running for the center-right presidential ticket, had said he would expect the French to ask for a vote similar to a Brexit, and he was not confident that voters would necessarily choose to remain.

“There will be an urge for a referendum, and we should anticipate it from a French point of view and a pan-European point of view,” Mariton said.

As the Brexit referendum result sunk in in Paris on Friday, 32-year-old Victor Jauvin said it was good that democracy exists to allow such votes, but he is nevertheless upset about the United Kingdom’s looming exit. “This was 200 years of developing this Europe,” he said. “It’s sad that it’s begun to disintegrate.”

“Hyperdemocracy is going to come one day for decisions like this, where we have to consult the citizens of all EU countries,” Jauvin said.

Felicie Poupon called the decision to leave hypocritical and selfish. “Every country in Europe is in crisis,” she said. “The vote isolates others more than building solidarity. It can’t just be ‘yes’ or ‘no’: We have to take another look at the union.”

The foreign affairs analyst Pertusot said that if France’s center-right Republicans were to win next year’s presidential election, several of the party’s stronger voices could call for a show “in or out” referendum knowing that an out would be “very, very unlikely.”

“The French like to say that they are disappointed with the EU, disenchanted – all the words the French love to say,” Pertusot said. “They dislike many aspects, feeling it’s too big or not French enough. But, at the same time, there is no hostility towards the EU like we see in some parts of the UK.”

Topics: Brexit Business

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