Who is FranÃ§ois Hollande?
The winner of the French election, FranÃ§ois Hollande, is a 57 year old doctor's son and former leader of the French Socialist Party. Hollande is a committed socialist and has been labelled as France's most left-facing leader since FranÃ§ois Mitterrand, who left office in 1981.
How is he different to Sarkozy?
In his re-election campaign, France's outgoing president Nicolas Sarkozy cited Hollande's lack of frontline political experience as a major weakness. Indeed, despite becoming a member of the French parliament in 1988, the same year as Sarkozy, Hollande has never held a cabinet position and, until now, has remained an unknown figure to most of the general public.
Hollande's relative ignominy is not all that sets him apart from Sarkozy. While his predecessor was reviled by large sections of the French media and public for his showbiz persona and ostentatious displays of wealth - he was seen wearing a watch worth nearly £30,000 at a recent political rally - Hollande seems to be far more humble. Despite his privileged upbringing in an affluent suburb of Paris, the former major of Tulle (population 15,000) cuts a far less glamorous figure, having learnt his trade from the bottom up in rural politics.
What has the reaction in France been to the result?
Despite his relatively narrow margin of victory (Hollande won 51.6 per cent of the final vote to Sarkozy's 48.4 per cent), Hollande's triumph was met with elation in Paris and tens of thousands of jubilant citizens poured onto the streets. In the run-up to the election, France had been quick to voice its dissatisfaction with Sarkozy's handling of the economic downturn, with 70 per cent of the population rating his record as president as poor, according to one poll. By contrast, Hollande's promise of "a new start" appears to have given fresh hope to a population weighed down by continued talk of austerity measures and rising unemployment.
What does this mean for France?
Whichever way you look at it, the election of Hollande represents a massive swing in France's political and economic outlook. Sarkozy's right-of-centre political leanings underplayed the true nature of his political tenure, which has seen the country veer away from its tradition of "big government" as part of a radical cost reduction programme. The austerity measures he brought in have included an increase to the national retirement age and sweeping cuts to welfare provision.
If his campaign pledge is anything to go by, Hollande's election seems set to bring about a reversal of much of his predecessor's work, with the president elect using his victory speech to announce an "end to austerity". Among his campaign pledges have been promises to boost welfare benefits, hire an additional 60,000 teachers, and return the age of retirement to 60 for some public sector workers.
To pay for these changes, Hollande will have to raise taxes or else allow the country's public debt - currently 86 per cent of GDP - to spiral out of control. This is a risky strategy, as France already possesses one of the highest levels of public spending in the EU. More significantly, his actions fly in the face of the targets set by the European Central Bank, which has called on France to reduce its budget deficit to three per cent of GDP by 2013. The International Monetary Fund (IMF) is forecasting a deficit of closer to 3.9 per cent.
What does the result mean for the rest of Europe?
Arguably the largest question mark following Hollande's election is what it means for France's relationship with its neighbour, Germany. In Nicolas Sarkozy, German chancellor Angela Merkel had a close ally in her push for austerity measures as solution to the eurozone's woes. Now her opposite number is a man with a very different set of values, shedding doubt on the ability of Germany to succeed in achieving financial reform in Europe. Hollande has indicated he will seek to renegotiate the terms of the fiscal treaty which Germany is spearheading in an attempt to reform the eurozone's economy and that his government will not support the plans in their current form.
It will take time for the dust to settle before the significance of Hollande's victory on the future of the eurozone becomes clear. However, the election of a left-wing president in one of Europe's major economies has so far been met with no little scepticism from the financial community. With events in Paris coinciding with political chaos in Greece, the value of the euro has fallen sharply on global currency markets and is expected to drop further over the coming weeks. The exit of Greece from the eurozone and the collapse of the European Economic Community now seem more real prospects than at any point over the past three years.