“Le Pen better than Macron for Italian industry: I expect surprises from ECB”

The French elections will also shake Europe and the ECB. Giulio Sapelli speaks: “The flag-waving wavers Lagarde’s autonomy”

Markets, as always, suffer the backlash of election results, for better or for worse. In the case of France, while political uncertainty reigns, economic paralysis is greeted with an ambivalence that reflects the mood of investors. And although the stock market seems to “dribbling” the risk associated with French debt, the country’s economic and political framework remains precarious and unstable. On the one hand, the possible victory of Marine Le Pen’s sovereign right could represent a significant shock. On the other hand, the continuation of the Macron government would not automatically guarantee a solution to the existing problems. On Affaritaliani.it, Julius Sapelliformer professor of Economic and Political History at the University of Milan, one of the leading experts in economics and international affairs, as well as “almost prime minister” in 2018 after ending up on the notebook of the “papabili” of Di Maio and Salvini, examines both scenarios.

Professor Sapelli, the stock market rebounds after the results of the first round in France. What are the immediate repercussions and the expected scenarios for the European economy?

The repercussions are significantly different from what everyone feared. First, the high voter turnout favored the advance of the National Front, although it fell short of an absolute majority by a handful of seats, an unexpected signal for many. Second, the markets reacted positively, as today the apparently more radical positions of the new Popular Front are of greater concern, compared to the free market structure of the current economy.

On the industrial level and in Italian-French relations in companies such as Stellantis or STMicroelectronics, what kind of consequences can we foresee?

It couldn’t go worse than it was before with Macron, with the Italian-French pact (so praised by Mattarella and the PD): in fact we have lost control of FincantieriGenerali has long been, as they call themselves, a French company. In the case of STMicroelectroncis, it has already been “Frenchified” for some time. This does not mean that they are badly managed, on the contrary they work well also thanks to the Italian managers who founded them, or managed them for a long time, just remember, in the case of Stmicroelectroncis, Pasquale Pistorio. I do not think that from the point of view of balance and industrial ownership, anything changes.

Even if the Rassemblement National were to win, on what fronts could our nation suffer repercussions?

None of these have proposed trade tariffs or controls, so I don’t think it would change anything at all. There is a climate of frenzy and expectation that has no economic basis. Indeed, in some ways, a right-wing government, which now looks to the Centre, would resolve the economic situation much more than a Macron government.which did not have a majority in Parliament, and which had to resort to Article 49 to pass the most important laws.

If they had done it in Poland, Hungary, or Italy itself, we would have cried dictatorship. With Macron, no one protested these formulations, so, frankly, it was a lot of ado about nothing. If we speak from a political point of view, there is the return of the great French Right: France has historically given rise to many right-wing movements in the world, anti-Semitism and Nazism were not born in Germany or Italy, but in France. However, we have now overcome this way of reasoning.

So will there be an anti-Le Pen front or will reasons of state prevail?

It all depends on the numbers. But I think the armed forces have never liked Macron, the ideological linchpin of the French army has always expressed contempt.

So will anything change on the defense front, if we also consider Macron’s position towards Ukraine?

The military never appreciated this young man who took away their job. So they will restore order and they will be very happy that it will be weakened. Macron had some dignity he should resigneven if dignity is no longer part of the political class, and I think it won’t be.

Even if it is premature, how will the ECB behave? Will the priorities (Green Deal, rate cuts) of the European Central Bank slip given the current economic instability?

This will be the most interesting thing to observe. The great, much vaunted autonomy of the ECB, of which Madame Lagarde has always been a supporter, will be put to the test. On this front, we will have many surprises, also considering the pressure from the Fed.