After the surge of nationalist populism that permeated western politics in 2016, the world will be watching as the French people take to the polls on May 7 to elect a new president. After a first round of voting on April 23 narrowed the options to two candidates, voters will have to decide between Emmanuel Macron, a political novice with basically centrist policies, and Marine Le Pen, the face of France’s far-right National Front Party.
This election’s implications run far beyond France’s domestic concerns, as many commentators have framed the voters’ choice as another referendum on the fate of the European Union. After Great Britain’s voters opted to pass a resolution to leave the EU in June 2016, nationalist parties gained substantial support in other European nations by espousing their distrust and contempt for the EU. To these parties’ great benefit, Eurozone economic performance has been hampered by the lingering effects of the 2008 Financial Crisis and sovereign debt issues in nations like Greece over the last few years. Under this context, candidates like Marine Le Pen have used the opportunity to knock the opaque EU leadership in Brussels, and are advocating for their countries to follow Britain’s lead by leaving the union. Her ascension into the last round of voting in the French presidential election is evidence of populism’s recent surge, and economists fear that an EU without Britain or France would quickly crumble.
Thus, the stakes will be high on May 7. Currently, commentators predict a Macron win, with the Telegraph putting the odds at 60/40. Most analysts assume that his centrist policies will attract a greater number of voters than Le Pen’s extreme positions, and Macron already received a slim plurality of the votes in the April 23 election. Before the election, Macron served as an economy minister under the current president, Francois Hollande, and made his support for the EU clear early in the campaign. Markets responded favorably to his strong performance on April 23, as the euro strengthened more than 1% against the dollar in trading the following day and stock markets increased on both sides of the Atlantic.
The strength of Le Pen’s campaign is undoubtedly her hard stance against the EU. If she was elected, a French exit would be far from certain because that could only happen with legislative approval, but she would certainly demand reforms and put pressure on the union. Furthermore, her election would further bolster anti-EU sentiments in other nations. Her supporters hope that Jean-Luc Melènchon’s voters will turn her way, as the socialist candidate used anti-EU fervor to advance his campaign. However, she will need to persuade a certain amount of moderate voters to join her cause as well if she can eclipse the 50% mark and pull off a surprising victory.
Regardless of what happens Sunday, investors across the world will be looking at the results from France to gauge the strength of the EU’s support.