(Bloomberg) -- Former European Central Bank President Jean-Claude Trichet said he hopes that moderate French political parties will join forces to form a coalition government that will make sure to keep France’s spending plans in check.
While President Emmanuel Macron’s track record helped boost France’s attractiveness and led to a “spectacular” decrease in unemployment, his public spending measures left the country with little room to maneuver going forward, said Trichet, who spoke on the Voternomics podcast hosted by Bloomberg’s Stephanie Flanders in Paris.
Europe’s former top central banker said a coalition of moderate political forces with government experience, from Socialists on the left to Republicains on the right, could impose fiscal responsibility and avoid a catastrophic scenario for France’s creditworthiness.
“It would be a catastrophe for the country to embark on additional massive spendings,” Trichet said Monday. “We have no room for maneuvering. That’s my clear diagnosis.”
France is mired in political uncertainty after a win by a left-wing alliance in Sunday’s legislative elections offered no party a path to claim the majority needed to govern.
The New Popular Front — which includes the Socialists and far-left France Unbowed — won 178 seats in the National Assembly. Marine Le Pen’s National Rally, seen as the frontrunner before the vote, came in third with 143 seats, while Macron’s centrist alliance notched up 156.
The surprise outcome means that France avoided the “mess” that would have occurred if the far-right National Rally or far-left France Unbowed had clinched an absolute majority, Trichet says. Still, France isn’t familiar with the political bargaining that comes with a hung parliament.
The legislature is now fragmented into three distinct groups with divergent agendas, though all promise further spending. The Institut Montaigne estimates that the campaign pledges by the New Popular Front would require nearly €179 billion in extra funds per year. The far-right National Rally’s plans would cost about €71 billion, while Macron’s party and its allies would incur extra spending of close to €21 billion.
Macron will wait for the new configuration of the National Assembly before making any further decisions on naming the next prime minister, according to a statement from an Elysee official Sunday.
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