News

    France's Presidential Frontrunner Gives Markets the Jitters

    Socialist candidate Francois Hollande, center, arrives at Brive airport in Brive, Central France, after the first round of the presidential election, April 22, 2012.
    Socialist candidate Francois Hollande, center, arrives at Brive airport in Brive, Central France, after the first round of the presidential election, April 22, 2012.
    Lisa Bryant

    The eurozone's sovereign debt crisis has helped topple half a dozen European leaders. It looks like French President Nicolas Sarkozy may be next. Polls show Sarkozy's Socialist rival, Francois Hollande, winning France's May 6 runoff election.  But the prospect of an Hollande presidency is making markets - and analysts - nervous.

    It's been nearly 20 years since France had a Socialist president. That may change in just over a week. French polls all predict Socialist contender Francois Hollande will beat conservative President Nicolas Sarkozy in the second round of presidential elections on May 6.

    In press conferences and interviews - like one on French radio Friday - Hollande outlines an economic strategy that includes more taxes for the rich and more spending to stimulate growth.

    But Hollande says his first action would target the wider eurozone crisis that is now in its third year.  Hollande says he will renegotiate a European Union fiscal treaty agreed to last year in order to promote economic growth.

    The Socialist candidate is getting applause from his supporters - but not from markets, which briefly dipped after he won the first round of French elections last Sunday.  Analysts like economics professor Tomasz Michalski, of the HEC business school in Paris, also see little reason to cheer.

    "First of all, Hollande is going to increase very drastically taxes in France. In the short run the increase in taxes is going to lower the budget deficit," he said. "But in the long run it's not a good growth strategy…this is going to keep talent away. And France desperately needs new businesses, desperately needs entrepreneurs to keep the economy going."

    Other experts agree. Britain's leading The Economist magazine is even more critical, calling Hollande's economic prescriptions "dangerous."

    Analyst Philip Whyte, of the London-based Center for European Reform, says he understands why markets are jittery about an Hollande presidency.

    "But of course, once he's in office, he will very quickly be confronted by some of the constraints of office and some of those constraints might be imposed by the bond markets," he said."

    Hollande's growth prescription for Europe even got some support this week by European Central Bank Chief Mario Draghi, who called on governments to invest in jobs and growth along with spending cuts.

    Jobs and economic growth are top concerns of French voters like 54-year-old Fatna Chouaikh.  Chouaikh believes Hollande can turn things around.   She says Hollande is competent, hard-working and has what it takes to bring France out of its economic doldrums.

    Under current President Sarkozy, the economy shrank and unemployment soared to nearly 10 percent.

    Most analysts agree that Sarkozy is not to blame for a global crisis that has sent many other economies tumbling as well. Whyte, of the Center for European Reform, credits Sarkozy for pushing through a few key reforms - like raising the retirement age - and for his initial leadership in the eurozone crisis.

    But Whyte faults the French president for letting German Chancellor Angela Merkel dictate eurozone policies today. And overall, he gives Sarkozy's performance a mediocre review.

    "The problem with Sarkozy is that he really doesn't have an economic vision," Whyte said. "He's a man of action. But he has no real coherence to much of what he does. If you look at his performance over five years as president, there's not been a terribly clear economic path he's forged."

    Professor Michalski offers similar criticism.

    "The measures that Sarkozy is proposing in this campaign do not form a coherent long-term program," he said. "Rather, they're small measures addressed to particular issues. So I'm very skeptical."

    Ultimately, smaller parties may shape the economic policies of either an Hollande or a Sarkozy presidency.  Hollande is counting on far-left and centrist voters to win the May 6 runoff.  Sarkozy is courting those who voted for the far-right in the first round - and who are skeptical of the European Union and of taking economic orders from Brussels.

    This forum has been closed.
    Comment Sorting
    Comments
         
    by: Phillipe
    May 03, 2012 2:34 PM
    Looks more like France will make the same error electing Hollande as USA made electing Obama.
    As the article cites Philip Whyte: "But of course, once he's in office, he will very quickly be confronted by some of the constraints of office and some of those constraints might be imposed by the bond markets," he said." The mythology that there is this evil 1% will continue....
    Margaret Thatcher still rings true.

    by: Jacques
    April 30, 2012 5:10 PM
    I just think that unless Mr Romney can somehow restore common sense confidence back to the business community Mr Hollande may well win as France can not risk privatizing any big rail, utility assets. After all how can the President convince the electorate to support change when he has spent his Presidency patching holes in a helium balloon? Bonne chance Mr le Président.

    by: Jean-Marc
    April 29, 2012 12:03 AM
    There is no surprise that The Economist, the voice of the 1% richest people, fears the perspective of the victory of Mr. Hollande in the next French presidential election. But, considering the disastrous performance of conservative austerity policies enforced in Ireland, Portugal, Spain, Italy, Greece and the UK, we can doubt The Economist's wisdom.

    by: Jean-Marc
    April 28, 2012 11:53 PM
    Foreigners may not be aware that beyond economy, this election will be won over value issues. Mr. Sarkozy blames the unemployed, the poors, the immigrants and the labour unions of being responsible of the crisis. He now embraces far right views about immigration. Mr. Hollande blames the banksters and the 1% most wealthy and promises to restore more justice, equality and solidarity. This contrast heats up the campaign to unprecedented level of passion on both sides.

    by: Jean-Marc
    April 28, 2012 11:45 PM
    During his 5-years term, Mr. Sarkozy outrageously supported the rich with 50 billion euros of tax cuts and approximately 50 billions more of tax loopholes that benefited the 1% richest only. He now promises to raise the VAT and to further reduce social benefits. Meanwhile Mr. Hollande promises first to reduces these fiscal gifts and restore more equality in the taxation system. This contrast might explain the more than advantageous polls in his favor in the first place.

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    German Artists to Memorialize Refugees With Life Jacket Exhibiti
    X
    Hamada Elsaram
    February 05, 2016 4:30 PM
    Sold in every kind of shop in some Turkish port towns, life jackets have become a symbol of the refugee crisis that brought a million people to Europe in 2015.  On the shores of Lesbos, Greece, German artists collect discarded life jackets as they prepare an art installation they plan to display in Germany.  For VOA, Hamada Elrasam has this report from Lesbos, Greece.
    Video

    Video German Artists to Memorialize Refugees With Life Jacket Exhibit

    Sold in every kind of shop in some Turkish port towns, life jackets have become a symbol of the refugee crisis that brought a million people to Europe in 2015.  On the shores of Lesbos, Greece, German artists collect discarded life jackets as they prepare an art installation they plan to display in Germany.  For VOA, Hamada Elrasam has this report from Lesbos, Greece.
    Video

    Video E-readers Help Ease Africa's Book Shortage

    Millions of people in Africa can't read, and there's a chronic shortage of books. A non-profit organization called Worldreader is trying to help change all that one e-reader at a time. VOA’s Deborah Block tells us about a girls' school in Nairobi, Kenya where Worldreader is making a difference.
    Video

    Video Genius Lets World Share Its Knowledge

    Inspired by crowdsourcing companies like Wikipedia, Genius allows anyone to edit anything on the web, using its web annotation tool
    Video

    Video Former Drug CEO Martin Shkreli Angers US Lawmakers

    A former U.S. pharmaceutical business executive has angered lawmakers by refusing to explain why he raised the price of a life-saving pill by 5,000 percent. Martin Shkreli was removed from a congressional hearing on Thursday after citing his Fifth Amendment right to stay silent. Zlatica Hoke has more.
    Video

    Video Super Bowl TV Commercials are Super Business for Advertisers

    The Super Bowl, the championship clash between the two top teams in American Football, is the most-watched sporting event of the year, and advertisers are lining up and paying big bucks to get their commercials on the air. In fact, the TV commercials during the Super Bowl have become one of the most anticipated and popular features of the event. VOA's Brian Allen has a sneak peek of what you can expect to see when the big game goes to commercial break, and the real entertainment begins.
    Video

    Video In Philippines, Mixed Feelings About Greater US Military Presence

    In the Philippines, some who will be directly affected by a recent Supreme Court decision clearing the way for more United States troop visits are having mixed reactions.  The increased rotations come at a time when the Philippines is trying to build up its military in the face of growing maritime assertiveness from China.  From Bahile, Palawan on the coast of the South China Sea, Simone Orendain has this story.
    Video

    Video Microcephaly's Connection to Zika: Guilty Until Proven Innocent

    The Zika virus rarely causes problems for the people who get it, but it seems to be having a devastating impact on babies whose mothers are infected with Zika. VOA's Carol Pearson has more.
    Video

    Video Solar Innovation Provides Cheap, Clean Energy to Kenya Residents

    In Kenya, a company called M-Kopa Solar is providing clean energy to more than 300,000 homes across East Africa by allowing customers to "pay-as-you-go" via their cell phones. As Lenny Ruvaga reports from Kangemi, customers pay a small deposit for a solar unit and then pay less than a dollar a day to get clean energy to light up their homes or businesses.
    Video

    Video Stunning Artworks Attract Record Crowds, Thanks to Social Media

    A new exhibit at the oldest art museum in America is shattering attendance records. Thousands of visitors are lining up to see nine giant works of art that have gotten a much-deserved shot of viral marketing. The 150-year-old Smithsonian American Art Museum has never had a response quite like this. VOA's Julie Taboh reports.
    Video

    Video Apprenticeships Put Americans on Path Back to Work

    Trying to get more people into the U.S. workforce, the Obama administration last year announced $175 million in grants towards apprenticeship programs. VOA White House correspondent Aru Pande went inside one training center outside of Washington that has gained national recognition for helping put people on the path to employment.
    Video

    Video New Material May Reduce Concussion Effects

    As the 2016 National Football League season reaches its summit at the Super Bowl this coming Sunday (2/7), scientists are trying to learn how to more effectively protect football players from dangerous and damaging concussions. Researchers at Cardiff and Cambridge Universities say their origami-based material may solve the problem. VOA’s George Putic reports.
    Video

    Video Saudi Arabian Women's Sports Chip Away at Stereotypes

    Saudi Arabian female athletes say that sports are on the front line of busting traditions that quash women’s voices, both locally and internationally. In their hometown of Jeddah, a group of basketball players say that by connecting sports to health issues, they are encouraging women and girls to get out of their homes and participate in public life. VOA’s Heather Murdock reports.
    Video

    Video A Year Later, Fortunes Mixed for Syrians Forging New Lives in Berlin

    In April of last year, VOA followed the progress of six young Syrian refugees -- four brothers and their two friends -- as they made their way from Libya to Italy by boat, and eventually to Germany. Reporter Henry Ridgwell caught up with the refugees again in Berlin, as they struggle to forge new lives amid the turmoil of Europe's refugee crisis.
    Video

    Video Zika Virus May be Hard to Stop

    With the Zika virus spreading rapidly, the World Health Organization Monday declared Zika a global health emergency. As Alberto Pimienta reports, for many governments and experts, the worst is yet to come.