x Abu Dhabi, UAETuesday 16 January 2018

French vote could threaten future of euro

The prospect of left-wing dominance of French political life casts uncertainty over the battle to save the euro and find a way out of financial chaos for debt-ridden Europe.

MARSEILLE // France decides its destiny today with François Hollande's socialists seeking a parliamentary majority to strengthen his presidential authority in increasingly stormy dealings with Germany.

With the second round of the legislative elections vying for page one space with France's win against Ukraine at Euro 2012, the right's hopes of preventing what it calls a "blank cheque" for Mr Hollande rest on its ability to persuade disillusioned supporters to vote.

Four voters in 10 abstained in last Sunday's first round, leading Nicolas Sarkozy's Union for a Popular Movement (UMP) to warn that a repeat today would inflict "irreparable damage" on the French economy.

The final opinion polls of the campaign varied only in the extent of the likely socialist victory over the right.

Mr Hollande's party needs 289 seats for an absolute majority and the last three surveys produced projections of between 284 and 330, with even the lower figure enough to ensure comfortable rule with the support of close allies.

The prospect of a new era of left-wing dominance of French political life casts a cloud of uncertainty over the battle to save the euro and find a way out of financial chaos for debt-ridden Europe.

Mr Hollande's relations with the conservative German chancellor, Angela Merkel, are in a critical state as she accuses him of pursuing a "false debate" between growth and budgetary rigour.

The French president's approach has dismayed the German leader, raising serious questions about the immediate future of the close Franco-German ties that have been a cornerstone of European stability since the Second World War.

During the past week, he has ruffled more feathers by welcoming leaders of German's opposition social democrats to the Elysée and making common cause in Rome with the Italian prime minister, Mario Monti, on alternatives to the programme of austerity that Mrs Merkel considers essential.

Concerned at signs of diminishing solidarity at the heart of the single currency area, the chancellor said measures to encourage growth and also to secure budgetary consolidation had always been central to the zone's strategy. "Both pillars belong together in the European crisis, both pillars are indispensable," Mrs Merkel said. "But both pillars rest on the conviction that we can only overcome the crisis by tackling it at its root: massive indebtedness, loss of competitiveness in some states and the failure of Europe to adhere to its own rules."

The relationship between leaders of the euro zone's two biggest economies will come under renewed scrutiny when they meet at this week's Group of 20 economic summit in Mexico and at European Union talks at the end of the month.

Mr Hollande has also had to deal with the issue of solidarity at home after his "first lady" Valérie Trierweiler's tweet of support for a rebel socialist who faces a straight run-off with his former partner, Ségolène Royal, in the western constituency of Charente-Maritime.

One poll suggested an emphatic win for the dissident, Olivier Falorni, who refused to stand aside to allow Ms Royal, a former presidential candidate and mother of Mr Hollande's four children, a clear path back to parliament.

The expected defeat of Ms Royal in such circumstances is a source of acute embarrassment to the socialist party. Some observers judge that while it is a storm Mr Hollande is able to ride, he must be concerned that Ms Trierweiler, a strong-willed political journalist, shows signs of being something of a loose cannon at the Elysée.

On matters of policy, the president has marked his first month in office by approving ministerial announcements of a string of left-leaning steps towards the sort of change he promised in his Elysée campaign.

As well as heartening socialist supporters by dwelling on the need for growth, he has promised measures ranging from a cap on public sectors bosses' pay with a ceiling of €450,000 (Dh2.1 million) a year, higher taxes on personal fortunes, the recruitment of more primary schoolteachers and an easing of Mr Sarkozy's contentious pensions reforms.

The right has denounced the socialists' plans as "disastrous". Jean-François Copé, the UMP general secretary, accuses the president of basing his strategy on a "denial of reality" and lacking clarity on Europe.

Today's election will also determine the fate of a number of prominent French political figures. Among those in danger of losing their seats are Claude Guéant, who was Mr Sarkozy's hardline interior minister, and Francois Bayrou, the leader of the enfeebled centrists.

The far-right, anti-immigration and eurosceptic Front National hopes to win a presence in parliament for the first time in 14 years, with its leader, Marine Le Pen, well placed to triumph in the northern constituency of Hénin-Beaumont, where she won 42 per cent of the vote to top the first-round poll.

Mr Sarkozy himself is said to have indicated privately that he sees little chance of his party halting the socialists' march, but also has concerns of his own to contemplate. His presidential immunity expired at midnight on Friday and he is now liable to be questioned in at least two affairs of allegedly illegal party funding.