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Here's why France's new president is not the solution to Europe's top existential threat

French presidential election candidate for the En Marche ! movement Emmanuel Macron delivers a speech at his campaign headquarters in Paris on May 7, 2017, after the second round of the French presidential election.
LIONEL BONAVENTURE | AFP | Getty Images
French presidential election candidate for the En Marche ! movement Emmanuel Macron delivers a speech at his campaign headquarters in Paris on May 7, 2017, after the second round of the French presidential election.

The future of the euro zone is dependent on a common commitment to solid government finances, says Commerzbank's chief economist, and France's new president-elect does not bring the bloc any closer to achieving this reality.

The pro-EU and centrist candidate, Emmanuel Macron, stormed to victory against his far-right political rival, Marine Le Pen, on Sunday and is now poised to become France's youngest ever premier.

However, the former economy minister is in favor of joint bond issuance which, according to Jörg Krämer, would sharply reduce each euro zone government's motivation to pursue sensible fiscal policies.

"The EU can't keep feeling its way from one election to the next. At some point an election might go the wrong way – and if that happens in a large country, the survival of the monetary union would be in jeopardy," Krämer said in a note.

Commerzbank's chief economist also warned the repeated near misses of anti-EU political leaders in several European elections in recent years would not last forever and suggested the monetary union's survival now rests on the bloc's ability to create a genuine banking union.

"To lay these existential risks to rest, the euro zone at long last needs a common commitment to solid government finances. The monetary union's long-term survival depends on it. But new French President Macron won't bring this any closer to reality," he added.

France… 'we have a particular problem'

Meanwhile, just one day after the pro-business and market-friendly candidate Macron secured his country's presidential election, European Commission President publically lambasted high state spending in the euro zone's second largest economy.

"With France, we have a particular problem ... The French spend too much money and they spend too much in the wrong places. This will not work over time," Reuters reported Jean-Claude Juncker as saying in Berlin on Monday.

Should Macron be able to govern effectively and subsequently deliver on his reformist agenda, Societe Generale's Chief Economist Michala Marcussen, projected France's gross domestic product (GDP) could increase by as much as 3 percent over the next decade.

"I think where Macron can actually come in and have a few wins is communicating a more positive message in France… but not just for France, also for Europe," Marcussen told CNBC on Monday.

While Macron faces significant challenges to implement somewhat ambitious structural reforms, Marcussen argued France would reap the rewards over the long-term.

'European dynamics will be all important'

"I think here it is quite interesting to be watching the political dynamics in Germany (too), we saw over the weekend that Schulz had a bit of a setback… but of course the European dynamics will be all important as well," Marcussen added.

On Sunday, German Chancellor Angela Merkel notched up another regional election victory, further bolstering her Christian Democrats (CDU) party ahead of national elections in the fall.

While, former European Parliament President and Social Democrats (SPD) leader, Martin Schulz, suffered yet another sobering result in the Schleswig-Holstein vote. The consequence of the regional vote appeared to dampen the outlook for Schulz's party ahead of September's national election.

Commerzbank's Krämer claimed a Schulz victory in a few months' time would result in a German premier more receptive to Macron's European initiatives. Further to this, Krämer predicted despite Macron's election victory on Sunday, the euro zone's pressing economic policy concerns are unlikely to dissipate any time soon.

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