French President Emmanuel Macron will attempt to marry his vision for Europe with the reality of German politics on Tuesday as he delivers a speech at the Sorbonne laying out plans for overhauling Europe’s single currency zone. Less than five months into his presidency, and having long promised to work with German Chancellor Angela Merkel on deepening euro zone integration with ideas for a standalone budget and finance minister, Macron’s ambitions face being sharply curtailed following Sunday’s German election result.
While still the largest bloc in the Bundestag, Merkel’s CDU/CSU conservative alliance secured fewer votes than expected and will likely have to strike a coalition deal with the liberal Free Democrats (FDP) and the Greens to form a government. The fiscally conservative FDP has made clear its opposition to many of Macron’s proposals, disliking the idea of a euro zone budget or any facility that may lead to financial transfers from wealthier euro zone countries to poorer ones, or the possibility of national debt being pooled.
The FDP has also called for a phasing out of Europe’s ESM bailout fund – which Macron wants to turn into a European Monetary Fund with preemptive powers to help out struggling countries – and wants to see changes to EU treaties that would allow countries to leave the euro zone. Rather than tailoring his speech to fit the contours of what the FDP, the Greens or Merkel’s partners may want, Macron is expected to keep his vision broad and far-reaching, while also detailing specific ideas for an improved euro zone.
Elysee officials said Macron will broach the topic of a euro zone budget, which he has suggested should be “several percentage points” of output, arguing such a facility will eventually be necessary and so should be discussed. He is also expected to talk about the need to deepen the link between European voters and European institutions, believing the democratic deficit is one of the reasons behind the rise of far-right and far-left populist parties.
In Berlin on Monday, Merkel alluded to Macron’s speech and said it was important to move beyond catchphrases into detail. “It is not about the slogans but what lies behind them,” she said. “I am talking about this with the French president.”
Merkel has sent conciliatory signals to Macron since his election, keeping the possibility of a Franco-German overhaul of the EU alive. But the result of Sunday’s election means her room for manoeuvre is now far tighter than even she might have expected.
It may take months before a coalition agreement is signed. But once it is, its contours are strict, effectively setting limits on the chancellor’s ability to act. Macron will need to find a form of words that keeps his vision alive while somehow keeping Merkel, the FDP and the Greens inside the tent. Otherwise his ambitions for Europe are likely to be cut short before they have barely been launched.