French presidential candidate and National Front leader, Marine Le Pen, said she wants to take France out of the euro, reiterating comments made the day before, and - taking a page out of the Yanis Varoufakis Grexit negotiating strategy playbook - added she wants to redenominate French government debt in a new national currency.
“More and more European citizens realize their economies have been suffocated by the euro,” she told reporters on the sidelines of a press conference in Paris quoted by Bloomberg.
Additionally, following the British example. Le Pen said that before leaving the euro, she would hold a referendum on France’s relations with the European Union and has pledged to hold such a vote within six months of an election victory.
“A national currency could be linked to a common currency,” she added, without giving further details on the connection. She said she could see the EU setting up another currency like the ECU, or European Currency Unit, which the bloc used for internal accounting purposes before the euro was introduced in 1999.
As Politico noted overnight, the National Front chief has long called for “Frexit,” a French withdrawal from the European Union. This would happen after a referendum on EU membership if she was elected next May (Le Pen has suggested that she would step down if the French rejected her preferred outcome).
But this time she said that after a referendum, Europe should retain a common currency, the euro, in parallel to the French franc. It was the first time Le Pen had recognized, however implicitly, that withdrawing from the euro zone unilaterally could bring about currency fluctuations, which the ECU was designed to prevent. Most French voters do not support withdrawal from the European Union, according to polls in 2016.
“I want a national currency with the euro as a common currency,” Le Pen said on BFMTV. “What was the ECU [European Currency Unit]?” Well, among other things, it was a fixed-exchange rate precursor to the Euro, so that may not be the best option.
As Politico adds, the shift came as Le Pen launched her presidential campaign and unveiled a series of campaign proposals, including vows to retain France’s 35-hour legal working week, end birthright citizenship and rewrite the Constitution to slash the number of MPs.
On the euro, National Front cadres have repeatedly hinted that Le Pen could water down her position before the election. Brutal withdrawal from the euro zone is particularly unpopular with senior voters who want to protect their assets from currency fluctuations.
Still, Philippe Murer, Le Pen’s economic adviser, told POLITICO that her position on the currency had not changed fundamentally. A return to the ECU, a basket of European currencies that existed before the euro, was one of several options being studied in the event of a withdrawal from the Euro, he said. “With a return to the ECU, we could retain a trace of the euro,” said Murer, who is also Le Pen’s assistant at the European Parliament.
“We will only determine these questions after consulting the French people. The nation must be able to decide for itself.”
It may be a moot topic: having had a substantial lead in the polls earlier in 2016, according to more recent polls, Le Pen has found herself behind her primary challenger Francois Fillon in recent weeks, especially in the second round of the presidential election where Fillon would have a 65% lead. Then again, if 2016 taught us anything, it is that polls are almost always wrong.