French President Emmanuel Macron is within striking distance of a historic re-election after clinching a first-round lead against far-right National Rally leader Marine Le Pen. Investors should be relieved, but not complacent, as the second round on April 24 is likely to be a close race.
Early results show France’s establishment parties in tatters. An increasingly fragmented electorate is looking for new answers after COVID-19 and Russia’s invasion of Ukraine expanded the reach of the state’s protective umbrella without banishing concern over higher inflation.
Socialist Paris Mayor Anne Hidalgo scored a dismal 1.5 percent, and the center-right’s Valerie Pecresse scored 5 percent — the worst on record for both parties.
France’s Fifth Republic is in uncharted territory, with Macron and Le Pen’s respective bases of white-collar and blue-collar voters displacing the 20th century’s Right and Left camps.
The hollowing out of the center is benefiting radicals of all stripes. Far-left firebrand Jean-Luc Melenchon came third with an impressive 21.9 percent, while hardline anti-immigration pundit Eric Zemmour won 7 percent.
Even as Melenchon exhorted his followers to keep Le Pen out of power, a good chunk of them must be mulling the opposite: a Le Pen vote, or no vote at all, to get Macron out.
Shifting allegiances and a rising share of candidates who are out to punish the elites — Le Pen, Melenchon and Zemmour received more than 50 percent of the votes — has made French politics more unpredictable, even as the state has become more generous following COVID-19.
Macron will have difficulty building a comfortable lead out of a frustrated electorate, with surveys estimating his poll share on April 24 at 51 to 54 percent.
Even if Macron remains the favorite, his lead is slim — and vulnerable — relative to his presidential runoff against Le Pen in 2017, when he garnered 66 percent of the votes.
After a mediocre campaign in which he refused to debate his rivals, Macron might have no choice but to fight his opponent head-on. He can claim an improved economy and a revitalized European influence, but he must be aware that his past reformist zeal is not going to win over Le Pen voters hankering for more protectionism.
Citizens want protection, Catherine Fieschi of consultancy Counterpoint said, making any second Macron term different from the first — not least with the composition of the French National Assembly to change.
Meanwhile, Le Pen will be a serious contender against Macron. She has excised her most toxic policy proposals — such as an explicit “Frexit” pledge — in favor of budget giveaways to those under the age of 30 and a flirtation with a Melenchon-esque retirement age of 60. Beyond targeting volatile far-left votes, she will also hope to profit from the turmoil in Pecresse’s party, which is split over who to back.
Diplomats in other European capitals are watching nervously: A Le Pen win would clearly be a thunderclap for the EU. Beyond the immediate impact on the Ukraine war effort of a candidate with ties to Putin who has been critical of sanctions against Russia, there is the real risk of institutional gridlock and internal fights over budgets, terms of trade and rule of law.
Calls by Le Pen to favor French goods and reclaim powers from Brussels raise the risk of a de facto Frexit, Jacques Delors Institute vice president Christine Verger said.
Macron must pit his own European project against Le Pen’s, while at the same time resisting the urge to focus solely on her extremism — her image as a candidate focused on consumer purchasing power has burnished her standing with voters, and that will take time to undo.
The stakes in this election for Europe and the world are high. France is the EU’s No. 2 economy and only nuclear power, at a time when the continent’s geopolitics and energy ties are undergoing radical change.
History is again on the move, to cite Arnold Toynbee: Macron will either be the first Fifth Republic president to win re-election since 2002 or the first to lose to the far right. He is proving that his rise was not an accident of history, but also underlining that French democracy is stuck in a “crisis,” as Christopher Dembik of Saxo Bank said.
It will take more than a rerun of 2017 to fix it.
Lionel Laurent is a Bloomberg Opinion columnist covering the EU and France. This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
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