Macron is now on the way out. He will either be a sorry figurehead in a Le Pen-dominated government, restricted to foreign policy or else trapped with political deadlock, and may well be hustled into an early retirement. It is hardly surprising if many of the banks are starting to wonder if Paris is such a good bet after all.
We can already see signs of that. French equities have been hammered, with bank stocks leading the massive losses, and earlier this week London overtook Paris again as the largest equity market in Europe. Even worse, France’s bond market is in turmoil, and the risk premium is rising.
Of course, it is up to the French to decide what path they want to take. And yet surely there is an opportunity here for the City. We should launch a lightning raid to win back some of the business lost.
True, the Labour government that will inevitably take power in Britain next month is not especially finance-friendly, and nor is it minded to cut any taxes. Even so, it has said it wants a strategy for growth and it will need to find some way of boosting its revenues. It would not be very hard to put together a package that would be attractive to some of the bankers now stuck in Le Pen’s Paris.
To start with, it could ring-fence banks and asset managers from its tough new employment laws, offering them an exemption from the regulations, just as Macron did in France. After all, most of the new rules are designed for low-paid warehouse and factory workers, not for Goldman Sachs bankers, and no one will have much sympathy if they are not allowed to ‘switch off’.
Next, it could ask the Bank of England to set up dual-language compliance and regulation, as the French did in the wake of our departure from the EU to tempt firms out of London.
We could offer some tax breaks, such as the 30pc income tax reduction offered to foreign workers in Paris or we could offer a reduced rate of capital gains tax for five years if any of those impressive French AI start-ups decide that London has just as much high-powered coding talent as Paris does. All it would take is a few minor tweaks to the tax and regulatory rules.
Over the last seven years, Macron openly tried to destroy the City and steal its business. The French government had no qualms about using Brexit as a lever to shift jobs and wealth to the other side of the channel. With France in turmoil, the British Government should try the same trick.
In reality, President Macron’s power is already fading. The City should bring some of that business home – and roll out the red carpet for any financier coming back to the UK.