François Hollande sworn in hours ahead of meeting with Merkel
FRANCOIS Hollande has been sworn in as France's first Socialist leader in nearly two decades at a ceremony at the Elysee Palace in central Paris.
Mr Hollande was sworn in as president following a handover of power from Nicolas Sarkozy, the conservative incumbent voters rejected after only one term in office at an election earlier this month.
Later, Mr Hollande will meet German chancellor Angela Merkel for a critical meeting on austerity and growth in Europe.
The French president is elected to a five-year term.
After the ceremony he immediately left for a bruising clash with Ms Merkel over crisis in the eurozone this evening – a showdown which, as his campaign manager, Pierre Moscovici put it, could set his presidency on a trajectory of “success or failure”.
Mr Hollande has championed the idea of renegotiating the fiscal pact that enshrines budgetary discipline in the eurozone to include a growth chapter. Mrs Merkel insists the pact, signed by 25 of the 27 EU countries and already ratified in some, must stay as it is.
The Chancellor has promised to welcome him with “open arms” and that the visit was just a "getting-to-know-you" gathering, but Benoît Hamon, the Socialist Party spokesman set the stage for a clash by saying on Sunday: “We didn't vote for an EU president called Mrs Merkel who makes sovereign decisions for the rest of us.”
The two could also be on a collision course over eurobonds. Mr Hollande initially argued that eurozone countries' debt should be pooled but faced with a wall of resistance from Mrs Merkel, he is now calling for new EU "project bonds" to fund large infrastructure projects. He wants these to be funded partly by existing EU funds and partly by the European Investment Bank – a proposal that could put him on a collision course with Britain.
They also fail to see eye to eye on the role of the European Central Bank, as Mr Hollande wants it to be more proactive in lending while Mrs Merkel staunchly defends its independence.
Neither can be seen to give too much ground due to domestic considerations. Mr Hollande’s Socialist Party must win a majority in parliamentary elections on June 10 and 17 to stand a chance of implementing his campaign promises, and his leftist allies are even more vocal on reversing austerity. But he also preaches fiscal discipline, promising to balance the budget by 2017.
Angela Merkel, meanwhile, is looking increasingly isolated at home after her Christian Democrat party suffered its worst ever defeat in the bellwhether state of North Rhine-Westphalia. The result boosted confidence among Hollande-allied Social Democrats with whom Mrs Merkel may have to form a coalition government next year. They are to announce their growth demands this morning (Tues).
Yesterday, the Chancellor described the loss as "bitter, painful defeat" but insisted her Europe policy "was not affected”.
She added: "No one on our side has anything against growth, but the question is what that means for budget policy. I would like to recall again that the Greek crisis was not caused by too much saving.”