Projections on the elections

The december 07, 2021

The 2022 presidential election is gaining momentum in the news. The economic debates during the elections will mainly focus on themes that have been highlighted by the Covid crisis.

The effectiveness of the state has been questioned with the difficulties of the health system during the Covid crisis. The comparison between the usual indicators of public sector efficiency and the weight of public expenditure shows that other OECD countries (Organization for Economic Co-operation and Development) have the same performance as France with much higher public expenditure. weak. The debate on the means of redressing the efficiency of the State seems inevitable.

In connection with economies that are becoming more digital and green, the low skills of the active population in France is a real handicap. The presidential campaign should be an opportunity to debate these difficulties since the health crisis has caused a strong distortion of the sectoral structure of the economy such as aeronautics, hotels and restaurants.

Point of vigilance on globalization and relocations, the opening of trade with other countries must be controlled. It must respond to the possibility of relocating to avoid bringing significant tax pressure on businesses.

What about energy transition and monetary policy?

The risk of the energy transition is real. By supporting the demand for mainly imported products such as solar cells or equipment for the production of hydrogen, this weakens the French economy. Indeed, France must consider setting up the production of its goods to avoid depending on imports.

Monetary policy is very expansionary, reflecting a rise in asset prices (equities, real estate, etc.) which has the effect of increasing wealth inequalities. The general opinion will be to reduce inequalities, so the question will be how to do this without impacting the economy. Countries will seek to make progress in tackling inequality and transitioning to a more sustainable world. Elections and political measures around the world will have a crucial impact on the outlook for 2022.

Where does Europe fit in these elections?

The impact of the elections is on several levels. New tax and social measures will be proposed by the various candidates. All candidates do not have the same position vis-à-vis companies. It will therefore be necessary to prepare for the birth of legislative measures which will not be without consequences on wealth management and taxation. The outcome of the presidential election will have a crucial impact on the outlook for the coming year and will play a major role in today's markets.

On a European scale, the policy of the ECB (European Central Bank) will be influenced by the French presidential elections and the candidate who will be selected.

Voters will be able to vote on the success of responses to the pandemic during the elections. Inflation could be a key factor in 2022 since the indicators are high. However, the ECB considers this phenomenon to be temporary. In this crisis, central bankers and policy makers acted quickly and decisively to prevent the global economy from drifting into recession.

As the election campaigns approach, our heritage experts are listening to your upcoming projects in order to best support you in the future!

In a changing world Wealh A7, always by your side to bring your desires to life.

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Article by : Coris N'DJA

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