French President Francois Hollande, left, meets European Commission President, Jose Manuel Barroso, during a meeting focused on the Malian situation, at the Elysee Palace in Paris, Saturday, Jan. 12, 2013. United Nations Secretary-General Ban Ki-moon said Friday that France, Senegal and Nigeria have responded to an appeal from Mali's president for help to counter an offensive by al-Qaida-linked militants who control the northern half of the country and are heading south. (AP Photo/Jacques Brinon)
François Hollande, left, and José Manuel Barroso © AP

François Hollande has attacked José Manuel Barroso’s decision to join Goldman Sachs , claiming that the former EU commission president’s “morally unacceptable” move demonstrated the need to rein in finance.

Speaking in his annual Bastille day television interview, the French president also defended his economic record, hinted at a possible bid for a second term and sought to defuse controversy about a highly paid hairdresser at the Elysée Palace.

But in some of his most striking comments, Mr Hollande highlighted Goldman’s role in arranging contentious derivatives trades for Greece, which helped Athens massage its public finances at a time when Mr Barroso led the commission.

He also noted the bank’s involvement in the US subprime mortgage crisis almost a decade ago.

“And we learn a few years later that Mr Barroso is joining Goldman Sachs? Legally, it’s possible,” the French president said. “But morally, and this is about the person, it’s unacceptable.”

Mr Barroso, whose appointment was announced this month, has himself denounced US banks in the past. In 2012, he claimed that the eurozone crisis “originated in North America” due to contamination “from some sectors of the financial market”.

Harlem Desir, France’s European affairs minister, has argued that Mr Barroso’s “particularly scandalous” appointment risks fuelling anti-EU sentiment across the bloc. “It’s the worst disservice Mr Barroso could do to the EU,” Mr Desir said.

Mr Barroso, who led the commission for a decade, told the Financial Times that he would try to “mitigate the negative effects” of the UK’s decision to leave the EU.

If the UK loses access to the single market, overseas banks may need to move parts of their large European businesses out of London.

However, Goldman said its decision to hire Mr Barroso as chairman of Goldman Sachs international “had nothing to do with the Brexit vote” and that discussions had begun when the campaign to persuade Britain to remain in the EU was thought likely to succeed.

It added that the former commission chief would “help advise our clients in Europe and around the world on a range of issues”.

France’s harsh criticism of Mr Barroso comes as Mr Hollande’s socialist government seeks to woo London bankers to Paris with generous tax breaks.

But in his wide-ranging interview, the French president seized on Mr Barroso’s appointment as proof that finance still needed to be “dominated”, a reference to a 2012 campaign speech in which he described finance as the “true adversary”.

“You think finance has disappeared? Yes I am attacking finance,” he said on Thursday. “It still has weight. Proof is, it snaps up the former commission president.”

The French president also positioned himself as a possible candidate for the presidency elections in April and May next year, although he says he will not announce his decision whether to run for a second term before December.

He also hit out at Emmanuel Macron, his own economy minister, for criticising rather than defending the government and nurturing presidential ambitions of his own.

Mr Hollande dodged questions over a hairdresser employed full time at the Elysée Palace for about €10,000 a month, news of which emerged this week. He remarked that he had lowered his own salary by 30 per cent when he became president.

Criticised by his own Socialist camp for granting €40bn in tax breaks to companies and seeking to reform labour rules to make them less rigid, Mr Hollande said that his pro-business policies were finally starting to pay off.

FILE - In this Oct. 16, 2014, file photo, a screen at a trading post on the floor of the New York Stock Exchange is juxtaposed with the Goldman Sachs booth. The Goldman Sachs Group Inc. reports quarterly financial results Wednesday, Jan. 20, 2016. (AP Photo/Richard Drew, File)
© AP

Unemployment of 10 per cent of the workforce will decrease this year, he claimed — an outcome he has set as a precondition for seeking re-election.

But he warned that France’s nascent economic recovery could be threatened next year if Britain’s vote to leave the EU resulted in a UK recession. “There is no certainty” that the French economy can grow by 1.7 per cent in 2017 as previously predicted, Mr Hollande said.

He urged Theresa May, the new British prime minister, to notify the UK’s departure from the EU as soon as possible, so as to provide greater certainty.

Mr Hollande called on the EU to offer more protection to its citizens, proposing setting up a budget for the bloc’s common security and defence spending.

In a clear hint about a possible second presidential bid, the 61-year-old said that France badly needed continuity.

“We will have to continue my policies,” he said. “The choices I made were the good ones . . . It’s the right direction, we have to follow it.”

Additional reporting by Arthur Beesley and Laura Noonan in London

Get alerts on José Manuel Barroso when a new story is published

Copyright The Financial Times Limited 2019. All rights reserved.
Reuse this content (opens in new window)

Follow the topics in this article