London Mayor Hits Back at ‘French Attack’
Boris Johnson has launched an offensive against France's central bank governor, accusing him of a "naked attempt to steal London's financial crown."
The mayor of London spoke out after Christian Noyer, governor of the Banque de France, told the Financial Times the euro zone nations should gain "control" of the bulk of the currency union's financial business, which is centered on the City of London.
Mr Johnson told the Evening Standard newspaper: "This is a desperate French attack in an effort to make something out of the euro zone crisis . . . shows utter contempt for the principles of the single market, and it will not succeed."
Mr Noyer said there was "no rationale" for allowing the euro zone's financial center to be "offshore," prompting sharp rebukes not only from Mr Johnson but also Vince Cable, U.K. business secretary.
"I don't think his analysis is correct," Mr. Cable told reporters while on a visit to Paris on Monday. "[It is] rather contradicted from what I pick up from serious French bankers [who believe that] having a strong U.K. financial sector is important for Europe. It is not a zero sum game. We want to be part of a single market in financial services."
The dispute broke out ahead of a meeting in Brussels on Tuesday where EU ministers will attempt to agree a deal handing the European Central Bank broad supervisory powers over banks.
Amid fears that the City will be sidelined under the new arrangements, George Osborne, U.K. chancellor, will push for safeguards to prevent euro zone members dictating rules to nations outside the currency union.
Mark Boleat, policy chairman at the City of London Corporation, the local authority for the capital's financial district, said the City supported the euro zone's efforts to resolve the financial crisis, but warned that "anti-competitive or protectionist measures" would damage its reputation as a place to do business. "As the continent's financial capital, London is not just a British asset but a European one too."
He added: "Any reforms must maintain the integrity of the single market's level playing field."
Mr Noyer spoke to the Financial Times while visiting Asia to promote Paris as a renminbi trading center. "Most of the euro business should be done inside the euro area. It's linked to the capacity of the central bank to provide liquidity and ensure oversight of its own currency," he said.
He added: "We're not against some business being done in London, but the bulk of the business should be under our control. That's the consequence of the choice by the UK to remain outside the euro area."
The London mayor's comments come less than a week after he mocked the French government over their treatment of Lakshmi Mittal, the head of steel group ArcelorMittal, who was attacked by the country's industry minister over his plans to close blast furnaces in France.
Describing the Socialist-led government as "sans-culottes" or revolutionaries, Mr. Johnson told a business audience in India: "I have no hesitation in saying here, 'Venez Londres, mes amis!' "