Further uncertainty on the future of the largest civilization project of the 20th Century could be cast by the elections in the Netherlands, France and potentially Greece over the coming months which could result in exit talks from the European Union (EU).
The election chances of Geert Wilders, the leader of the euro-sceptic and populist group, Party for Freedom (PVV) could be the critical factor for the probability of the Netherlands exiting from the EU in the near term.
While the latest opinion polls suggest he is in the lead to secure the most votes, Wilders has vowed to hold an EU referendum should he win the election on March 15. The PVV’s radical views seems to have effectively ruled out the party’s coalition prospects and additionally, it appears unlikely he will win enough support to form a majority government.
“Only the PVV has taken a clearly pro-Nexit stance,” a team of Deutsche Bank analysts said in a note.
“Other (soft) Eurosceptic parties have been more cautious, for instance, suggesting separate votes on aspects of EU participation rather than (a) complete ‘in or out’. A poll by TNS Nipo asking the hypothetical Nexit question suggests that it would get a majority only among PVV voters,” the report added.
The country’s highly complex legal system means it would be remarkably difficult to create a binding vote supported by the electorate and Dutch political history indicated a referendum on such a scale is unlikely, Deutsche Bank’s analysts argued.
Promise of renegotiating the terms of France’s membership of the EU if elected president in May have been made by Marine Le Pen, leader of the anti-immigration and populist National Front (NF).
Either the former economy minister and independent candidate, Emmanuel Macron or center-right candidate Francois Fillon could defeat Le Pen in the second and final round of voting, suggests the latest opinion polls and hence her chances of victory in May appear limited.
But as U.S. President Donald Trump’s surprise victory as well as the Brexit vote in the U.K. both defied expectations, the NF leader could yet harbor some hope of securing the French presidency.
“In many ways, all this is reminiscent of the run-up to Brexit,” Jörg Krämer, chief economist at Commerzbank, said in a note.
“At that time the then-British (Prime Minister David) Cameron wanted to negotiate with the other EU members to obtain more leeway for the U.K., and put the result to a referendum. However, Marine Le Pen is likely to achieve even less than Cameron in this respect, and France leaving the EU would have far greater repercussions than Brexit,” Krämer added.
In order to overcome its current impasse over its bailout package, the Greek lawmakers are under intensifying pressure from the EU and the Internaitonal Monetary Fund (IMF) which has raised the specter of a potential Grexit.
Though the implementation of the country’s austerity measures has prompted concern from the EU and the IMF, Greece is currently on a third bailout program worth 86 billion euros ($92 billion).
The potential for snap general elections in Greece is evident, although Moody’s credit rating agency expect the country’s government to be able to meet the demands from the EU and IMF, the agency projected.
The EU’s demands for more austerity are falling on deaf ears in Athens, said
“Since the two positions are irreconcilable, another crisis seems to be in the offing,” he suggested.
“It will no doubt end with the necessary compromise between the parties concerned, but given the very different standpoints, matters will probably have come to a head first (so) a new Greek crisis may be necessary to clear the logjam,” he concluded.
(Adapted from CNBC)