Politics.be
3 mei 2012, 19:30
Ahead of the second round of the French presidential election, Open Europe has published a new briefing looking at how a victory for either Nicolas Sarkozy or François Hollande could impact on the eurozone and the EU as a whole.
Open Europe analyst Vincenzo Scarpetta said,
“No matter who wins, France could well become a more difficult and assertive EU partner, though both candidates are likely to struggle to deliver on their various promises to take on Europe, such as re-negotiating the fiscal treaty and tougher border controls.”
“The Franco-German axis will continue, but a Hollande victory in particular will mean a more unpredictable relationship and therefore potentially more uncertainty on the markets. Clearly, under Hollande, Germany will find it far more difficult to push its vision of a eurozone based on strong budget discipline.”
To read the briefing in full, click here:
http://www.openeurope.org.uk/Content/Documents/Pdfs/2012Frenchelections.pdf
The key issues at a glance
1. The future of the French economy
Sarkozy wins: Balanced budget in 2016, some tax increases and minor structural reforms.
Hollande wins: Balanced budget in 2017, a spending package of €20 billion, higher taxes on big businesses and banks.
Impact on the eurozone/EU: The difference between the two candidates on deficit reduction targets is small. However, both are based on overly optimistic growth assumptions and there is a risk that the targets will not be met, especially if the crisis in Spain gets worse – which would be bad news for the euro.
2. The future of the Franco-German axis
Sarkozy wins: Potential disagreements over the role of the ECB and France’s threat to suspend its participation in the EU’s border-free Schengen area.
Hollande wins: Potential disagreements over German austerity, the role of the ECB and the ‘fiscal treaty’ on budgetary discipline.
Impact on the eurozone/EU: The Franco-German axis will continue under both candidates, but could come under increasing strain if the eurozone crisis intensifies, and particularly if Hollande wins.
3. The role of the ECB
Sarkozy wins: Will continue to push for more ECB intervention and government involvement in exchange rate discussions.
Hollande wins: Will push for the ECB being allowed to lend directly to governments and to the eurozone’s permanent bailout fund, the ESM.
Impact on the eurozone/EU: Paris and Berlin will continue to disagree over the role of the ECB, in turn fuelling uncertainty in the eurozone. The dispute would likely be more heated under Hollande.
4. The fiscal treaty on budgetary discipline
Sarkozy wins: France will most likely ratify it.
Hollande wins: France will not ratify the treaty unless ‘pro-growth’ measures are added.
Impact on the eurozone/EU: Despite disagreements, Merkel and Hollande are likely to strike a deal on the treaty, potentially through a growth clause loosely attached to it. The treaty would become meaningless without France’s ratification.
5. The ‘golden rule’ on balanced budget
Sarkozy wins: Golden rule to be inserted into the French constitution, a referendum on the issue could be called before the end of 2012.
Hollande wins: Transposed into French law, but not inserted into the constitution.
Impact on the eurozone/EU: France’s failure to insert a balanced budget rule into its constitution could be interpreted as France not having the intention to actually abide by the rule – particularly in light of its previous violations of the original Stability and Growth Pact.
6. Immigration and Schengen
Sarkozy wins: France could suspend its participation in the Schengen agreements if border controls are not toughened up within a year.
Hollande wins: Non-EU economic migration should be limited, ideally through a coordinated response agreed at the EU level.
Impact on the eurozone/EU: Sarkozy’s stance on Schengen is largely rhetoric designed to lure in far-right Front National voters, and he is unlikely to follow through. If he did, it would set the stage for a major row with the EU.
7. The ‘Buy European Act’
Sarkozy wins: As a last resort, France could unilaterally limit access to its public procurement markets to firms producing in Europe, unless ‘reciprocity’ with the EU’s trading partners is achieved.
Hollande wins: France will want more ‘reciprocity’ from the EU’s trading partners.
Impact on the eurozone/EU: Sarkozy is unlikely to follow through, but if he insists, he will be heading for a row with the UK and others, and potentially the European Commission.
NOTES FOR EDITORS
1) For more information, please contact Vincenzo Scarpetta on 0044 (0)207 197 2333 or 0044 (0)796 924 0642, or Mats Persson on 0044 (0)779 946 0691.
2) Open Europe is an independent think-tank calling for reform of the European Union. Its supporters include: Lord Leach of Fairford, Director, Jardine Matheson Holdings Ltd; Lord Wolfson, Chief Executive, Next Plc; Hugh Sloane, Co-Founder and Chief Executive, Sloane Robinson; Sir Stuart Rose, former Chairman, Marks and Spencer Plc; Jeremy Hosking, Director, Marathon Asset Management; Sir Henry Keswick, Chairman, Jardine Matheson Holdings Ltd; Sir Martin Jacomb, former Chairman, Prudential Plc; Lord Sainsbury of Preston Candover KG, Life President, J Sainsbury Plc; Michael Dobson, Chief Executive, Schroders Plc; David Mayhew, former Chairman, JP Morgan Cazenove.
For a full list, please click here:
http://www.openeurope.org.uk/Page/Supporters/en/LIVE
Bron: politics.be (http://www.politics.be/persmededelingen/32430/)
Open Europe analyst Vincenzo Scarpetta said,
“No matter who wins, France could well become a more difficult and assertive EU partner, though both candidates are likely to struggle to deliver on their various promises to take on Europe, such as re-negotiating the fiscal treaty and tougher border controls.”
“The Franco-German axis will continue, but a Hollande victory in particular will mean a more unpredictable relationship and therefore potentially more uncertainty on the markets. Clearly, under Hollande, Germany will find it far more difficult to push its vision of a eurozone based on strong budget discipline.”
To read the briefing in full, click here:
http://www.openeurope.org.uk/Content/Documents/Pdfs/2012Frenchelections.pdf
The key issues at a glance
1. The future of the French economy
Sarkozy wins: Balanced budget in 2016, some tax increases and minor structural reforms.
Hollande wins: Balanced budget in 2017, a spending package of €20 billion, higher taxes on big businesses and banks.
Impact on the eurozone/EU: The difference between the two candidates on deficit reduction targets is small. However, both are based on overly optimistic growth assumptions and there is a risk that the targets will not be met, especially if the crisis in Spain gets worse – which would be bad news for the euro.
2. The future of the Franco-German axis
Sarkozy wins: Potential disagreements over the role of the ECB and France’s threat to suspend its participation in the EU’s border-free Schengen area.
Hollande wins: Potential disagreements over German austerity, the role of the ECB and the ‘fiscal treaty’ on budgetary discipline.
Impact on the eurozone/EU: The Franco-German axis will continue under both candidates, but could come under increasing strain if the eurozone crisis intensifies, and particularly if Hollande wins.
3. The role of the ECB
Sarkozy wins: Will continue to push for more ECB intervention and government involvement in exchange rate discussions.
Hollande wins: Will push for the ECB being allowed to lend directly to governments and to the eurozone’s permanent bailout fund, the ESM.
Impact on the eurozone/EU: Paris and Berlin will continue to disagree over the role of the ECB, in turn fuelling uncertainty in the eurozone. The dispute would likely be more heated under Hollande.
4. The fiscal treaty on budgetary discipline
Sarkozy wins: France will most likely ratify it.
Hollande wins: France will not ratify the treaty unless ‘pro-growth’ measures are added.
Impact on the eurozone/EU: Despite disagreements, Merkel and Hollande are likely to strike a deal on the treaty, potentially through a growth clause loosely attached to it. The treaty would become meaningless without France’s ratification.
5. The ‘golden rule’ on balanced budget
Sarkozy wins: Golden rule to be inserted into the French constitution, a referendum on the issue could be called before the end of 2012.
Hollande wins: Transposed into French law, but not inserted into the constitution.
Impact on the eurozone/EU: France’s failure to insert a balanced budget rule into its constitution could be interpreted as France not having the intention to actually abide by the rule – particularly in light of its previous violations of the original Stability and Growth Pact.
6. Immigration and Schengen
Sarkozy wins: France could suspend its participation in the Schengen agreements if border controls are not toughened up within a year.
Hollande wins: Non-EU economic migration should be limited, ideally through a coordinated response agreed at the EU level.
Impact on the eurozone/EU: Sarkozy’s stance on Schengen is largely rhetoric designed to lure in far-right Front National voters, and he is unlikely to follow through. If he did, it would set the stage for a major row with the EU.
7. The ‘Buy European Act’
Sarkozy wins: As a last resort, France could unilaterally limit access to its public procurement markets to firms producing in Europe, unless ‘reciprocity’ with the EU’s trading partners is achieved.
Hollande wins: France will want more ‘reciprocity’ from the EU’s trading partners.
Impact on the eurozone/EU: Sarkozy is unlikely to follow through, but if he insists, he will be heading for a row with the UK and others, and potentially the European Commission.
NOTES FOR EDITORS
1) For more information, please contact Vincenzo Scarpetta on 0044 (0)207 197 2333 or 0044 (0)796 924 0642, or Mats Persson on 0044 (0)779 946 0691.
2) Open Europe is an independent think-tank calling for reform of the European Union. Its supporters include: Lord Leach of Fairford, Director, Jardine Matheson Holdings Ltd; Lord Wolfson, Chief Executive, Next Plc; Hugh Sloane, Co-Founder and Chief Executive, Sloane Robinson; Sir Stuart Rose, former Chairman, Marks and Spencer Plc; Jeremy Hosking, Director, Marathon Asset Management; Sir Henry Keswick, Chairman, Jardine Matheson Holdings Ltd; Sir Martin Jacomb, former Chairman, Prudential Plc; Lord Sainsbury of Preston Candover KG, Life President, J Sainsbury Plc; Michael Dobson, Chief Executive, Schroders Plc; David Mayhew, former Chairman, JP Morgan Cazenove.
For a full list, please click here:
http://www.openeurope.org.uk/Page/Supporters/en/LIVE
Bron: politics.be (http://www.politics.be/persmededelingen/32430/)