France is experiencing a “very serious” period as parliamentary elections approach, according to President Emmanuel Macron on Friday.
The financial markets are uneasy, with the far-right and far-left political blocs leading the polls.
This political uncertainty has already led to a significant sell-off of French bonds and stocks after Macron unexpectedly called the election.
This decision came after his centrist party was defeated by Marine Le Pen’s eurosceptic National Rally (RN) in the European Parliament elections last Sunday.
“We are at a very serious moment in the history of our country.
“There are major issues at stake, with wars, and with unprecedented economic challenges,” Macron stated at the conclusion of a G7 summit in Italy.
Macron’s comments echoed those of French Finance Minister Bruno Le Maire, who warned that France, the euro zone’s second-largest economy, faced the risk of a financial crisis if either the far-right or far-left won the upcoming parliamentary election due to their heavy spending plans.
Macron described both blocs as “extremist,” claiming neither was politically serious or economically realistic.
Initial opinion polls suggest that the RN, which has pledged to reduce electricity prices, lower VAT on gas, and increase public spending, could win the election and potentially govern.
A poll for Le Point magazine published Friday evening indicated RN leading in the first round of the parliamentary election, narrowly ahead of a left-wing coalition called the “Popular Front.”
The poll showed RN with 29.5% of the vote, compared to 28.5% for the Popular Front and 18% for Macron’s camp.
At least two polls placed the left not far behind the RN and ahead of Macron’s centrist camp.
These polls were conducted before left-wing parties agreed to a joint platform to counter the far right and Macron’s camp, promising to link salaries to inflation and introduce a wealth tax for the wealthy.
The left-wing alliance is expected to announce its economic program soon, with broad plans to increase household purchasing power and reduce energy prices.
Based on its 2022 proposals, it aims to cut VAT on energy to 5.5% from 20% and increase public spending, despite significant public debt.
RN leader Jordan Bardella, visiting a farm in Chuelles, south of Paris, said their plans would be financed by addressing tax loopholes.
He emphasized priorities like cost-of-living issues, reducing immigration, and being tough on crime.
“France is on a slippery slope, it is at risk of bankruptcy,” he said, urging the French to “dare to choose change.”
Concerns about stability have led to the biggest weekly increase since 2011 in the premium investors demand for French government debt, and bank stocks fell sharply this week.
Senior technology firm executives warned that the RN’s proposed immigration curbs threaten France’s ambition to become Europe’s leading AI hub.
Meanwhile, left-wing parties formed a new alliance, scrapping Macron’s unpopular pension reform. “Emmanuel Macron won’t have a majority,” said Greens leader Marine Tondelier.
“It’s either the far right or us,” she stated, urging left-wing voters to support the new “Popular Front,” which includes the Socialists, Greens, Communists, and hard-left Unbowed France.
Unions and rights groups have called for rallies against the far right this weekend.