Be afraid if France shuns the EU
BRENDA from Bristol made headlines last week after expressing exasperation at the thought of a General Election. Many agreed. The broad outcome is a foregone conclusion and the excitement will lie in seeing how devastating it is for Labour and how it shifts the balance of power in Theresa May’s Government. But those who like more immediate drama (not to mention horror) in their elections need look no further than France.
Today’s first round in the French Presidential vote will almost certainly see the farRight’s Marine Le Pen voted through to the final stand-off. There is a possibility that the second place will go to far-Left Jean-Luc Melenchon, leaving France with a choice of extremes both of whom are notorious eurosceptics and have threatened to pull France out of the euro and, if necessary, the EU altogether. We should be very afraid. The immediate effect of such a result will be a sharp drop in the value of the euro which, while good news for holidaymakers, would really be a sign that the EU has entered a fresh crisis.
Some will cheer the prospect of the EU collapsing, but to do so would be madness. A chaotic EU risks a return to economic slump. That would be bad news for Britain – we need a strong European economy as a trading partner for our own economy.
A weak euro might boost the pound in the short term, helping holidaymakers, but a recession for our biggest trading partner would damage the UK economy and almost certainly weaken the pound against other currencies in the longer run. Some will argue a weaker pound will be good for exporters – but they are unlikely to be cheering in 2019 if the EU is so paralysed by ‘Frexit’ that it is unable to do a deal with us of any kind. ONE year on from the collapse of BHS and the damage is still yet to be fully accounted for. As we report today, about 100 BHS stores are about to be handed back to their landlords, just as demand for department store space in the UK is at its lowest ebb, with Marks & Spencer and Debenhams both announcing store closures in the last week. We are in the midst of a quite fundamental change in the shape of our town centres as department stores cease to dominate, becoming instead empty shells. It may take years for those new uses to be found (or for sites to be redeveloped).
Too many major retailers failed to prepare for the transformation. Like the ruins of past civilisations, they should be a reminder that the only rule is that change is inevitable and complacency is the greatest sin. ‘Look on my Works, ye Mighty, and despair!’