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UPDATE 1-France urges bigger euro role in international trade
July 9, 2014 / 4:52 PM / 3 years ago

UPDATE 1-France urges bigger euro role in international trade

PARIS, July 9 (Reuters) - The euro zone must work to bolster the role of its common currency in international business transactions, France’s finance minister said on Wednesday, comments supported later by the head of French utility GDF Suez.

Michel Sapin made a similar call last week when France’s largest bank BNP Paribas agreed to pay almost $9 billion to resolve U.S. accusations that it violated sanctions.

He said on Wednesday that increasing the euro’s presence in international transactions would also allow businesses to avoid a currency exchange risk.

Talking about the extra-territoriality of U.S. laws linked to using the U.S. dollar, Sapin told a conference: “The euro zone must think about the role it is giving to its common currency - and mobilise itself to bolster the usage of the euro as an international exchange currency.”

The head of GDF Suez, Gerard Mestrallet, became the latest French executive to question the dominance of the U.S. dollar in international trade on Wednesday after similar comments by the CEO of oil major Total over the weekend.

“I believe there’s a rebalancing which is becoming more urgent than in the past because of what’s happened with BNP,” Mestrallet told France 24 television in an interview.

“What we have here is an opportunity to make players think and incite them to use the euro more,” added Mestrallet, who also heads the Paris Europlace lobby in charge of boosting Paris’s profile as a financial centre.

Sapin said last week that euro zone finance ministers would discuss at a regular meeting they held on Monday ways to enhance the use of the euro, but he did not attend those talks and no news came out of any discussion of the issue, officials said.

According to U.S. law, banks can be prosecuted for processing U.S. dollar transactions for countries subject to U.S. economic sanctions, even if the operations involve non-U.S. branches.

Oil major Total’s chief executive, Christophe de Margerie, backed Sapin’s call during the weekend, saying there was no reason to pay for oil in U.S. dollars.

“Doing without the dollar, that wouldn’t be realistic, but it would be good if the euro was used more,” he said. (Reporting by Maya Nikolaeva; Additional reporting by Robin Emmott in Brussels and Michel Rose in Paris; Writing by Ingrid Melander; Editing by Andrew Callus)

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