NO EASY EXIT FROM THE FRENCH POLITICAL CRISIS
France now faces a period of deep political uncertainty that is already unnerving investors in French sovereign bonds and stocks. Earlier this week, France’s borrowing costs briefly exceeded those of Greece, generally considered far more risky.
Macron must now make a choice.
Three sources told Reuters that Macron aimed to install a new prime minister swiftly, with one saying he wanted to name a premier before a ceremony to reopen the Notre-Dame Cathedral on Saturday. U.S. President-elect Donald Trump is due to attend.
Any new prime minister would face the same challenges as Barnier in getting bills, including the 2025 budget, adopted by a divided parliament. There can be no new parliamentary election before July.
Macron could alternatively ask Barnier and his ministers to stay on in a caretaker capacity while he takes time to identify a prime minister able to attract sufficient cross-party support to pass legislation.
A caretaker government could either propose emergency legislation to roll over the tax-and-spend provisions in the 2024 budget into next year or invoke special powers to pass the draft 2025 budget by decree – though jurists say this is a legal grey area and the political cost would be huge.
The danger for Macron is that his opponents vote down one prime minister after the next.
His rivals say the only meaningful way to end the protracted political crisis is for him to resign, something he has hitherto shown little inclination to do.
The upheaval is not without risk for Le Pen, who has for years sought to convince voters that her party offers a stable government in waiting.
Barnier’s entourage and Le Pen’s National Rally party, which had been propping up the minority coalition, each blamed the other for the crisis.
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