The world may have been shocked by images of burning cars and buildings during riots in France this month, but for French business leaders gathered in Aix-en-Provence, it’s overblown.
(Bloomberg) — The world may have been shocked by images of burning cars and buildings during riots in France this month, but for French business leaders gathered in Aix-en-Provence, it’s overblown.
Many of the attendees of a gathering in Aix that’s often dubbed the “French Davos” insisted on the resilience of the nation’s economy — even as they conceded that some partners cancelled business travel to France, and that some of their employees downed tools to join the riots.
Grocery chain Carrefour SA was especially exposed, as some of its stores were ransacked. Chief Executive Officer Alexandre Bompard also said that some of his young employees participated in the violence. “It was incredibly painful to see our stores being looted,” he said, blaming inflation and “a feeling of exclusion.”
The riots and looting in deprived and diverse suburbs known as “banlieues” have exposed deep rifts in French society. Repairs are now underway to clean up burnt buses and smashed glass fronts, with insurers as of Tuesday estimating damage claims at about €280 million ($305 million) so far. This compares with 10,000 claims for a cost of €205 million during the last major riots in late 2005, according to Florence Lustman, chair of French insurers’ lobby France Assureurs.
The episode, sparked by the deadly shooting of a 17-year-old by a police officer in the suburb of Nanterre near Paris, raises big questions for President Emmanuel Macron on current and past governments’ failures to tame inequalities and address issues in policing. It’s unclear how it will affect Macron’s drive to attract foreign investment, although his advisers say they’re confident it won’t.
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Still, Jean-Pierre Clamadieu, the chairman of energy giant Engie SA, acknowledged that some US colleagues cancelled planned meetings in France “because of images on TV that looked like a civil war.” Still, he added: “It doesn’t reflect reality.”
The riots also raised questions for the business leaders who gathered in Aix to participate in panels on public debt, on how to connect generations together and how re-balance power within companies. This year, the conference theme was “How to recreate hope.” The gathering was an opportunity to capture the zeitgeist of France Inc., whose stewards are often reluctant to comment on social issues.
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The chairman of Renault SA, Jean-Dominique Senard, speaking on a panel entitled “Development, durability, what choices for humankind?” said the nation’s troubles are “related to the issue of evolution of capitalism,” without elaborating. Senard has previously advocated for companies to focus on general interests and not just profits.
“Our role is social inclusion,” said Carrefour’s Bompard. “We need to stay in these areas and train people.”
The riots have mostly abated in the past week as the government rolled out some 45,000 police officers on the ground. “This episode is behind us today,” Clamadieu said.
Macron’s government has also played down the significance of the episode, rejecting comparisons with 2005 and saying that protesters had no clear demands for those in charge of public policies. Prime Minister Elisabeth Borne, who cancelled her appearance in Aix, told Le Parisien on Sunday that on the worst night of rioting, 7,000 to 8,000 people were on the streets, a fraction of the 6 million residents of neighborhoods identified by the government as needing special funds.
“What has happened to France over the past few days is serious but I don’t think it has damaged France’s attractiveness for investors,” said Marguerite Berard, the head of French retail banking for BNP Paribas SA. Bank branches throughout the country were looted and burnt.
Clare Lombardelli, chief economist with the Paris-based Organization for Economic Co-operation and Development, said France was no exception in dealing with “the issues of cost of living, inequalities, and a sense that he economic system isn’t working for everyone.”
She echoed Laurence Boone, France’s junior minister for European Affairs, who pointed to riots in Denmark in 2008 and in the UK in 2011 — just a year before the 2012 London Olympic Games. Paris is hosting the 2024 Summer Olympics.
“It’s probably a sort of epiphenomenon,” Stephanie Paix, CEO of French bank Natixis told Bloomberg TV. “The media likes to stress these kind of difficulties.”
–With assistance from Phil Serafino.
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