French business leaders have been thrown into new uncertainty by early parliamentary elections called by President Emmanuel Macron, which risk strengthening the far right.
The federations are acting cautiously in their public comments, aware that they will be able to sit at the table with the ministers of the National Rally (RN) if the party achieves a major advance in the votes on June 30th and July 7th.
The local business group U2P “would respect the people’s choice, but the RN has to say more precisely what it proposes on issues with fiscal, social and economic effects on small businesses”, its head, Michel Picon, told AFP.
In the last presidential elections of 2022, the group warned that the campaign promises of the head of RN, Marine Le Pen, “would have negative consequences for business”, he recalled.
At stake are issues such as a return to the official retirement age of 60 – raised to 64 in an extremely unpopular reform by Macron last year – and an even tougher crackdown on immigration.
“What does this mean for the people who work for us today?” Picon asked.
“We are businesspeople who don’t get involved in politics,” said Thierry Cotillard, head of the Mousquetaires/Intermarche supermarket chain.
But “whoever the politicians are, we will fiercely defend our positions”, he warned.
Investors clearly signaled their alarm at the sharp sell-off in French stocks – the benchmark CAC 40 index of blue chips fell 1.4 percent on Monday and a further 1.3 percent on Tuesday.
French government bond yields have also soared, suggesting growing doubts about France’s ability to finance its spending if the RN puts its promises into practice.
Macron’s Finance Minister, Bruno Le Maire, warned that “if the RN carries out its program, a debt crisis in France is possible”.
Earlier Tuesday, he had urged business leaders to “stick their necks out” against the far right.
– Risk of ‘mistrust’ –
Centrist Macron’s mandate was marked by reforms aimed at making life easier for companies and courting high-level foreign investment.
In contrast, “we know nothing” about RN’s plans, said the head of the French subsidiary of a large European industrial company, on condition of anonymity.
“We just saw the beginning of reindustrialization 10 years ago, with supply-side policies bearing fruit. Will all of this be maintained?” he asked.
Without naming any party, the main employers’ federation MEDEF told AFP that “a new campaign is starting in which we do not share certain political views, which are incompatible with business competitiveness and the prosperity of our country and our fellow citizens”.
Such proposals “would inevitably lead to a further deterioration of our public finances and tax reductions for families and companies”, he added.
The CPME small business group, for its part, called for the continuation of supply-side policies, cuts in greenhouse gas emissions and welfare state reforms.
He also warned about France’s staggering three trillion euro ($3.2 trillion) debt pile, which ratings agency Moody’s said on Monday was at risk of being downgraded due to “potential political instability.” of the next elections.
“Anyone who undertakes expensive reforms without taking this element into account would be exposing France to a great risk,” said the CPME.
– ‘Essential low-carbon electricity’ –
A sector with particular fears of a far-right victory is renewable energy, which has been waiting for months for a government roadmap that extends until 2035.
“What is happening is serious,” said Jules Nyssen, president of the Renewable Energy Union (SER).
“We are in a state of total instability, precisely when we need legal guarantees and clarity,” he added. “This will cost us dearly.
“We have a clear roadmap that we need to eliminate carbon emissions,” said Nicolas de Warren, president of the UNIDEN association of large industrial energy users.
“What is essential for us is access to competitively priced low-carbon electricity, whether nuclear or renewable.”
By 2022, Le Pen has promised a fleet of around 20 new nuclear reactors – although her 2031 timetable for delivering half of them was seen as unrealistic.
But she is also a staunch opponent of wind power, promising a moratorium on new construction and the gradual dismantling of existing wind farms – plans incompatible with France’s climate commitments.
“The laws of the economy and energy will catch up” with those of RN when it comes to energy, said an electricity supplier on condition of anonymity.
“We need more cheap energy. Building nuclear power takes 10 to 15 years. What do we do while we wait? And how do we attract battery factories if we don’t want any more electric cars?” he added, citing another of Le Pen’s bogeymen.
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