Now & Next: European Elections Special – State of Play in the EU, France and UK

Key takeaways from our recent Now & Next Elections Special webinar:

• In the European Union (EU) there were major gains for the populist right with a newly the established group, “Patriots of Europe” making them the third largest party in the European Parliament.
• A core challenge will be the re-appointment of the European Commission (EC) president Ursula von der Leyen on July 18. Both the EC president and businesses will need to reflect on how to engage and work with the populist right.
• The EU is keen to discuss with the UK ways to ease friction around trade by establishing improvements around bottlenecks.
• Stronger defence spending and investment, diversifying the EU’s supply chains and capacity in key technologies, building on the green and digital transition and maintaining a robust and sustainable trade policy, are likely to dominate the next 5-year policy agenda. 
• Whilst in France there is currently a hung parliament with the left bloc “New Popular Front” coming out on top.
• However, they still need to agree on the potential candidate to lead as Prime Minister. In the meantime, the central block is also seeking to create an alternative majority. This unprecedented situation is creating political uncertainty and possible longer-term instability.
• In any case, the new French government will need to compromise across the wining coalition as the left bloc parties vary from hard-left to centre-left creating differences on key policies and priorities. They will need to find allies beyond their mere simple majority, possibly on a per project basis. The French parliamentary system is not used to such coalition building exercises.
• Depending on the political hue of the government, France may be less pro-business, less pro-EU and more state centric.
• In the UK, the move from right of centre to centre left likely to lead to more stability than past 8 years but will have to operate within severe fiscal constraints.
• The core ambition and challenge will be stimulating growth while keeping taxes under control.
• Businesses should keep an eye on changes to worker rights and areas of social regulation.