Hollande’s vision endorsed by poll, but delivery is the test
French President Francois Hollande arrives at the G20 meeting of developed nations in Mexico with a resounding victory in weekend parliamentary elections behind him, allowing him a louder voice in discussions set to revolve around the Eurozone debt crisis.
Hollande’s Socialist party and its affiliates won 307 seats, comfortably exceeding the 289 required for a majority in the National Assembly. Final results including overseas territories were due later on Monday, with polls predicting the Socialists could win up to 320 seats.
France’s leftist parties already hold the Senate or upper house of parliament, and further wins would allow them to push through anti-austerity measures without having to rely on eurosceptic parties or the conservative UMP opposition.
Hollande, due to address the G20 summit today, stopped in Rome on Friday for four-way talks with Italian Prime Minister Mario Monti, German Chancellor Angela Merkel and Spanish Prime Minister Mariano Rajoy.
He is likely to push through the popular “pro-growth” economic and financial measures he promised during his election campaign quickly. He has already dropped the general French retirement age to 60 from 62, which is set to cost the state tens of billions in coming years.
A special session of parliament scheduled for next month will axe tax breaks and increase taxes for large corporations, particularly banks and energy companies, said local analysts. However, the government, with a secure five year term ahead, could use a State Auditor review due by the end of June to pare back spending promises.
Hollande’s challenge, say investors, is to retain both voter and market confidence as unemployment hits a 13-year high of 10%, and worries of financial contagion resume after Spain and Italian bond markets come under pressure. Hollande has pledged to balance France’s budget by 2017, and persuade Germany to back a $100bn stimulus package.