French government quits just hours after being appointed, deepening political crisis

Paris: France's new Prime Minister Sebastien Lecornu and his government resigned on Monday, hours after Lecornu announced his cabinet line-up, making it the shortest-lived in modern French history, driving stocks and the euro sharply lower.

The swift resignation was unexpected and marked another major deepening of France's political crisis. It came after allies and foes alike threatened to topple the new government.

Lecornu was prime minister for only 27 days. His government lasted 14 hours. The far-right National Rally immediately urged President Emmanuel Macron to call a snap parliamentary election. The hard left France Unbowed said Macron himself must go.

New Cabinet line-up angered opponents

After weeks of consultations with political parties across the board, Lecornu, a close ally of Macron, had appointed his ministers on Sunday and they had been set to hold their first meeting on Monday afternoon.

But the new cabinet line-up had angered opponents and allies alike, who either found it too right-wing or not sufficiently so, raising questions on how long it could last, with no group holding a majority in a fragmented parliament.

Lecornu handed his resignation to Macron on Monday morning.

"Mr. Sebastien Lecornu has submitted the resignation of his Government to the President of the Republic, who has accepted it," the Elysee's press office said.

French politics has become increasingly unstable since Macron's re-election in 2022 for want of any party or grouping holding a parliamentary majority.

Opposition wants snap elections

Macron's decision to call a snap parliamentary election last year deepened the crisis by producing an even more fragmented parliament. Lecornu, who was only appointed last month, was Macron's fifth prime minister in two years.

"There can be no return to stability without a return to the polls and the dissolution of the National Assembly," National Rally leader Jordan Bardella said after Lecornu resigned. Mathilde Panot, of the hard left France Unbowed, said: "Lecornu resigns. 3 Prime Ministers defeated in less than a year. The countdown has begun. Macron must go."

French stocks and Euro fall

Paris' CAC 40 dropped 2%, on track for the biggest one-day drop since August, as Lecornu resigned, making it the worst-performing index in Europe, as banking shares came under heavy fire, leaving BNP Paribas, Societe Generale and Credit Agricole down between 5.7% and 7.3%.

The euro slid 0.7% on the day to $1.1665.

Deep stability

France has rarely suffered a political crisis so deep since the creation in 1958 of the Fifth Republic, the current system of government.

The 1958 constitution was designed to ensure stable governance by creating a powerful and highly centralised president endowed with a strong majority in parliament, and to avoid the instability of the periods immediately before and after World War Two.

Instead, Macron - who in his ascent to power in 2017 reshaped the political landscape - has found himself struggling with a fragmented parliament where the centre no longer holds the balance and the far-right and hard-left hold sway.

France is not used to building coalitions and finding consensus.