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French election is an existential moment for the global order

The election of the next French President will have important implications. A Marine Le Pen victory would create challenges for the European Union and would have an impact on the Western response to the war in Ukraine.

GianLuigi Mandruzzato, a senior economist at EFG Asset Management, looks at why the French presidential election is important for the global geopolitical equilibrium. On 24 April, the incumbent Emmanuel Macron and challenger Marine Le Pen will again face off in the second-round ballot for the French presidency for the next five years. The outcome on

Sunday is much more uncertain than five years ago when pro-European Union Macron won with 66% of the vote. Electoral polls put Macron ahead with about 55% of the vote this time around (see Figure 1). Despite the right-wing parties winning less than 35% of votes in the first round, many in the other centre-to-left parties are not convinced by Macron’s proposals.

According to analysts, there is a risk that a high abstention rate by left-wing voters will open the doors of the Elysée to the eurosceptic Le Pen.

The consequences would be problematic for the European Union and would also affect the functioning of Nato, impacting the global geopolitical equilibrium. Many of Le Pen’s proposals would put Paris on a collision course with Brussels. Le Pen, a long-time eurosceptic, wants the European Union replaced by a ‘Europe of nations’.

She is proposing a referendum to amend the French Constitution and establish the supremacy of French over European law. Poland and Hungary were condemned by the European Court of Justice for holding similar positions. Le Pen has also pledged to reduce French payments to the EU budget by EUR 5 billion, about one third of the current French contribution, and to stop military co-operation with Germany.

If France, one of the founding members of the European Union (EU) and the second largest economy in the area, took these positions, those who oppose greater European integration would be strengthened making it more difficult for the EU to function and progress.

Furthermore, Le Pen wants to change the status of foreigners living in France who would be discriminated against in favour of French citizens in the allocation of social housing, employment and social benefits. Even this proposal would be contrary to the principle of equal rights and free movement of citizens within the European Union.

Finally, Le Pen wants France to leave the integrated command of Nato, to which it returned in 2009. With respect to the war in Ukraine, she is in favour of intelligence support to it, but has been ambiguous about providing military support. Le Pen is critical of the sanctions against Russia because they penalise the French economy.

Instead, she proposes a strategic rapprochement between Nato and Russia immediately after the current confrontation to prevent the creation of an anti-Western Sino-Russian alliance. Again, Le Pen’s proposals contrast with the approach taken by Western countries during the Ukraine crisis and would weaken opposition to Russian aggression.

To conclude, Le Pen’s immigration and foreign policy positions are a challenge to the European Union, Nato and the global geopolitical equilibrium. If Le Pen is surprisingly elected President after Sunday’s ballot against incumbent pro-EU Macron, the markets will face a scenario that was unthinkable just a few months ago – geopolitical uncertainty would structurally increase.

If Macron wins, as expected, nothing much would change although the risk of a Le Pen Presidency would only be postponed. In the first round of this year’s presidential elections, a third of French votes went to right-wing candidates openly against greater European integration, and another fifth went to the left-wing candidate Mélenchon, who is also highly critical of the EU.

Based on this evidence and with Macron ineligible to stand again after two consecutive mandates, Le Pen has every reason to be optimistic about her chances of election in 2027.

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