European Elections - outcomes and consequences for business 

French Presidential Election

On 24 April 2022, Emmanuel Macron was re-elected President of France, the first French President to be re-elected since Jacques Chirac in 2002. Macron secured a strong victory, however with far-right candidate, Marine Le Pen, securing 40%, the far right is now one of the leading political forces in the country. The election highlights how the political landscape has shifted away from a traditional right-left divide in France, with voters identifying more with anti-establishment positions.  

Across Europe, there was an initial sense of relief among many as Macron beat euro-sceptic Le Pen. His victory was broadly welcomed as a win for pro-European politics, with a continuation of French foreign policy and a sustained commitment to the green transition. The UK Prime Minister also welcomed Macron’s victory and a reset of relations could be expected although this will largely depend on how negotiations on the NI protocol fare, and whether the UK decides to trigger Article 16.

The focus now turns to the legislative elections in June. The President will need a majority in the National Assembly to avoid a “cohabitation” or political gridlock, however this is far from guaranteed with voters often using parliamentary elections to signal their lack of support.

What are Macron’s top priorities?  

• French foreign policy: Macron is committed to Europe and France providing Ukraine with military equipment and welcoming refugees. 
• Cost of living: Macron has authorised billions of euros in subsidies for energy bills (capping energy bills rather than dropping VAT as Le Pen proposed). He also has promised to peg pension payments to inflation and has vowed new tax cuts for both households and businesses. 
• Climate: Macron wants to make France the first big country to stop using coal and gas and has pledged to build six new nuclear power stations, as well as ramping up investments in renewables. Contrast this to Germany’s planned phase out of nuclear, it becomes clear that the traditional Franco-German alliance remains fragile.
• France’s role in Europe: Macron will continue his push to develop what he calls Europe's "strategic autonomy", driving a more protectionist agenda. 

Elections across Central and Eastern Europe

Elsewhere, electoral outcomes in Hungary and Serbia have seen landslide consolidation of the incumbent right-wing populist leaders, with Orbán and Vučić re-elected respectively. However, in Slovenia the environmentalist centre-left Freedom Movement party defeated the populist Janša. 

Recent election outcomes are indicative of the intensifying divergence across Europe, which may potentially translate to reduced EU-wide consensus on certain matters such as the retaliation to Russia’s aggression in Ukraine and energy decoupling from Russia. 

The success of Orbán’s Fidesz party in Hungary paves the way for a continuation of clashes over the EU’s core values. Given the EU is considering an energy embargo on Russia, Orbán – President Putin’s closest EU ally – would be likely to oppose this too, as he has reiterated that Hungary will not decouple its energy reliance on Russia. In contrast, the shift to the left in Slovenia will result in a stronger push for climate-mitigating policies and an enhanced pro-European stance. In turn, this will render Orbán increasingly isolated given the loss Janša, one of his last EU allies.

Want to find out more?

If you are interested in hearing more about the CBI’s work in Europe, please get in touch with Sean, CBI’s Director for Europe, or register to attend the Europe Briefing on 31 May.