European  

Political rise of euroscepticism

This article is part of
EU Economy - May 2014

In the past few days Europe has been going to the polls to vote for the 751 MEPs that will fill the European Parliament.

Many often overlook these elections, which take place every five years, but these results could highlight a trend that could affect future integration in the region.

The rise of the alternative or eurosceptic parties, in response to the austerity measures and recession across the continent, has been rapid and is growing – from Ukip in the UK to the National Front in France.

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In its eurosceptic heat map, JPMorgan Asset Management compares the results in the 2009 European Parliamentary elections with the forecasts for the latest election, with some interesting results.

The image shows France, in particular, has had one of the most dramatic switches, going from less eurosceptic to very eurosceptic in the past five years, along with Finland. Other countries that have moved to a more eurosceptic stance include Italy, Lithuania, Romania, Bulgaria and Spain. Two of these countries have already had serious fiscal issues, and imposed austerity does not seem to have gone down well with their electorate.

James McCann, OECD economist at Standard Life Investments, notes: “The polling data suggests we could see up to a quarter of seats in the European Parliament won by those who are alternative or eurosceptics, potentially close to 200 out of the 751 seats.”

But he adds that while it sounds like a large proportion of the vote, “their overall power is probably capped, given they are not natural bedfellows to form a coalition”.

Instead, Mr McCann suggests the biggest impact in the rise of eurosceptics could be through national politics, as mainstream politicians react to the success of these fringe parties.

“European elections are unusual in that voter behaviour is different to what we would see during a normal national election for local parliament. People see it as a chance to put out a protest vote and eurosceptic parties campaign on European issues. So you wouldn’t expect the success of those parties to translate fully into national elections.”

Kerry Craig, global market strategist at JPMorgan Asset Management, notes that federal elections in Belgium (scheduled for May 25), and general elections in Sweden in September are the next barometers of public feeling.

He adds: “These elections may not seem as critical as developments in the ‘crisis economies’, but they are still an important political marker that can help verify the level of dissatisfaction with Europe. As a result, a rise in anti-Europe sentiment would not do much to help reinvigorate the appetite for further monetary and political integration.”

Nyree Stewart is features editor at Investment Adviser

EUROPE ELECTIONS

2014

May – European Parliament

May – Lithuania

May – Ukraine

May – Belgium

September – Sweden

September – Scotland Referendum

October – Latvia

November – Romania

2015

Denmark

Finland

Estonia

Portugal

Poland

Slovenia

Spain

UK