“Glory and Restoration”
30 Apr, 2019 14:13
source: 香港奇点财经 Singularity Financial
Meeting and Interviewing with Mr. Christian Noyer, Honorary President of Central Bank France, Founding Vice President of European Central Bank
I. Global Financial Governance
II. Financing for Growth
IV. Restoring the Continental Financial Center(s)
V. Fintech will transform our society only when achieving the equilibrium between Innovation and Security
Part I. Global Financial Governance
Singularity Financial: Being the founding VP of ECB (European Central Bank), who also served as chairman of BIS, and alternate Governor with IMF, what is your view of the present financial capability both in terms of resilience and viability supporting the next wave of economic growth in France, EU, and globally?
Christian Noyer: I think we need to recall that there was a second crisis in EU in 2011 and 2012 after the initial one in 2008 in the US, due to interaction of the weak fiscal positions of some member states and the fear that markets had that banks might need this fiscal support, as what had happened in the US, UK and the Netherland. But since then, the EU and particularly the Euro Zone has completely repaired the weakness of the system. We had created intervention fund, EMS, we gave a broad controlling advisory system of the EU central banks, and reinforced enormously the capital base for banks to resist all possible difficulties.
Part II. Financing for Growth
Singularity Financial: Back on France, you expressed positive comment on President Macron in 2018 for leading France into new growth. Now looking at the fundamental momentum of the three areas you prioritized, i.e., labor as a factor for growth; capital by tax reform, and increase of productivity, how satisfied are you? What are the measures to do better still?
Christian Noyer: I think my analysis and hope are more true than ever. It’s fortunate that just a couple of days ago, the OECD has issued an analytical study on France, and they were extremely positive on the effect of those structural reforms. The OECD has expectations not only on the major reforms of labour market and the tax regime, but also education, vocational training, and unemployment benefit. The expectation for growth potential should increase by 0.3 to 0.4 per year. And that the overall per capita GDP will increase between 3% to 5% the next few years.
Part III. BREXIT
Singularity Financial: In relation to Brexit, through the past months of wrestling between dramatic sentiments and rationality, what will be the final result you foresee?
Christian Noyer: One important thing that everyone has to understand: nobody in the EU wanted the UK to leave. This was what President Macron has repeated and again. We would like to keep the the Great Britain in the EU, and yes, we are still ready to welcome them back absolutely. But we have to respect the willingness of the UK people.
Part IV. Restoring the Continental Financial Center(s)
Singularity Financial: Does the result of Brexit make your work easier or harder, to promote Paris as the alternate Financial Centre in EU, or even to replace London as the largest one across UK and EU?
Christian Noyer: Well, we can look at this from the economy in general and the financial sector, it would depend, of course, on the the choice that will be made by the United Kingdom. But this is going to have consequences in the case of the financial sector. There are regulatory reasons for firms to make hard choices quickly.
Part V. Fintech will transform our society only when achieving the equilibrium between Innovation and Security
Singularity Financial: Banks and financial institutions need to evolve to augment sustainable economic and social development worldwide, particularly after the 2008 Crisis. Where are they standing now in this journey? What are the most effective drivers for this transformation in your view?
Christian Noyer: Yeah, when we look back to the years before the 2008 crisis, there was this tendency of sophisticated financial products to a level that they were losing all links with the real economy, that led to the extreme difficulties that we had. I mean, there were many reasons why the system was not safe at at the time. And what we have cured was not only to increase the capital base of the banking system or to oblige the clearing and settlements, facilitating the reduction of the building of piles of financial operations, but also the simplification of financial products.