French economy minister Emmanuel Macron stepped down on Tuesday, presumably to plan a presidential candidacy for the election next year.

“I have touched the limits of our system, the last-minute compromises, its imperfect solutions,” Macron said in a speech. “I want to start a new phase of my fight today.”

He stopped short of revealing his presidential ambitions, but coming four months after the launch of his own centrist political movement, En Marche!, there is little doubt in France what the former investment banker is up to.

Controversial

Macron is fairly popular with the electorate at large but a controversial figure inside his own Socialist Party. He is the public face of President François Hollande’s late conversion to social democracy, spearheading liberal economic reforms such as allowing small firms to opt out of collective bargaining agreements.

That is why I argued in May he is unlikely to prevail in a left-wing primary.

Macron’s “Blairite ways,” I wrote, “are an affront to many old-school socialists who cling to France’s heavily-regulated, state-centric social model.”

Should Hollande not run for a second term — and he might be wise not to, given his dismal approval ratings — I still think his prime minister, Manuel Valls, is the more likely successor.

Incrementalist

Valls is a social democrat, like Macron. When he ran against Hollande in the 2012 primary, it was as a reformer who vowed to abolish the 35-hour workweek and crack down on Islamism in France.

But unlike the younger politician, who stormed in from outside and seems to believe he can upend the left-right divide all by himself, Valls is an incrementalist who patiently worked his way up through the Socialist Party machine.

His career may be less exciting to magazine editors who like to put the handsome Macron on their covers, but it makes Valls the more probable leader of a party that spans the entire left-wing spectrum of French politics.

“Valls has more support in parliament and a deeper understanding of how power is accumulated from the ground up,” a supporter told Politico earlier this year, “and not from the top down, as Macron is proposing to do.”

Identity politics

Another difference is experience. Macron knows the economy but little else. Valls is emphasizing identity and security issues, arguing, for example, that the full-face Islamic veil should be banned from secondary schools and public buildings.

He said in an interview with Libération that “culture and identity”, not the job market, will be the most important issue in the 2017 election.

He may be right. Joblessness, especially in the deindustrialized north, is linked to people’s concerns about immigration and globalization, but the question of French identify manifests itself in all the major political issues of the day, from what sort of an economy France wants to have to how it copes with Islamic terror, Muslim integration and the exodus of French Jews.

Macron has the answer to one of those questions. His France is an altogether more liberal place, with looser labor laws, fewer restrictions on enterprise and youngsters coming from all over to study, work and start businesses.

While Macron was off promoting this vision of France at Davos and in Silicon Valley, Valls was governing a country in a state of emergency, in place since the November terrorist attacks in Paris. He previously served as interior minister, is seen as strong on law and order and has resisted European pressure on France to admit more refugees.

In a presidential contest that is likely to pit the Socialist candidate against Nicolas Sarkozy on the right and Marine Le Pen on the far right — both hardliners on immigration and security — Macron could appear untested. Valls would appeal more to the center and might stem some of the defections to the far left that a Macron candidacy would inevitably inspire, something that threatens to take the Socialists out of contention for the crucial second voting round.