Le Journal du Dimanche, June 23, 2024.
[Excerpts from the article, full version accessible to subscribers – in French].
Former Vice President of Apple, Pascal Cagni runs C4 Ventures and finances 48 tech companies. He warns of the risk of an economic crash in the event of a victory by LFI or the National Rally.
Two weeks after the dissolution and seven days before the vote, is the political crisis in France having an impact on the business community and foreign investors?
I receive a lot of phone calls from investors who are caught between waiting and concern. They understand that everything that has been done over the past ten years is now being questioned. Some have invested heavily, such as in the battery valley in the Hauts-de-France, which is projected to create 20,000 jobs by 2030. I’m thinking of the mega semiconductor factory in Grenoble, an industry essential to our economic sovereignty, where the state invested 2.9 billion euros to attract the European company STMicroelectronics and the American company Global Foundries. Today, all of these projects are threatened.
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In early May, at the Choose France summit organized in Versailles, Amazon committed to investing 1.2 billion euros. We were talking about a “record-breaking” summit. Is all of this now in danger?
Regarding Amazon, they were already being discreet at the summit because they feared protests against their development. I don’t know if they will back out of their commitment. But the risk is real when, for example, Microsoft has the choice to set up a data center in Alsace or outside of our borders; or when the giant Scania has the choice to build a battery assembly plant in Anjou or in the Netherlands. When you think that the healthcare giant Novo Nordisk, one of the largest market capitalizations in the world, was planning to invest 2.2 billion euros in France, today, there is no guarantee that this commitment will be honored.
Day after day, the National Rally amends its economic project, as if to reassure business leaders and foreign investors. Does this have a positive and reassuring effect?
The goal of any political party is to seize power. The concessions or ambiguities regarding pensions from Jordan Bardella are an illustration of this. In the end, the costings of the National Rally’s program will force them to back down or delay. But there will be no questioning of certain commitments because their credibility is at stake. Now, let’s be clear: what will a worker care about a 20-euro VAT reduction if they lose their job? That’s the choice. Whatever one might criticize about President Macron, 2.2 million jobs have been created. Having watched my country for thirty years with unemployment over 10 or 12%, I have come to believe in full employment. What is at stake is historical and will have very serious consequences. In my field, 52% of 1,800 international projects are expansions, with a doubling of jobs at stake. All of this is now in question: less investment, so fewer direct and indirect job creations.
I hear what you’re saying, but the purchasing power of the French has increased in the last two years. Inflation has been limited. Unemployment is decreasing. And yet, the French credit neither Emmanuel Macron nor the business world with these successes.
You’re absolutely right. And by the way, investors from around the world don’t understand this! It’s a truism, but it’s a reality: the French don’t like each other. Yet, they benefit from a state that redistributes more than any other in the world. They have faced less severe inflation than in Great Britain. Their purchasing power has increased over the past fifteen years, while the Italians have not regained the pre-financial crisis level of 2008. And they forget that thanks to the state-guaranteed loan (PGE) during COVID, 120 billion euros financed the partial unemployment of 14 million workers. Nowhere else in the world has a people been so protected.
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Do you encourage French business leaders to get more involved in this campaign?
Until recently, I found it shameful that all these entrepreneurs, who have benefited from state protection and ten years of reforms, remain silent. It’s good to sign opinion pieces with a list of 300 big names, but that’s not enough! I urge the leaders of unicorns, all the new exporters who have seen their operating accounts improve, and the heads of foreign companies to go out on the ground, explain to their employees how they planned to invest 20 or 30 million euros to expand their site, but might have to abandon that plan tomorrow.
