by Yann Le Guernigou
PARIS (Reuters) – The French economy is expected to accelerate as expected in the end of the year after his air hole of the spring but not low enough for that 2016 is distinguished from 2015 and 2017 starts on a note more robust, according to the Insee.
If its objectives are undermined by these new forecasts, the government could argue that, even with this sluggish growth, job-creation are well-spread in the private sector and that the unemployment rate is expected to continue its decrease.
In its note de conjoncture quarterly published Thursday, the Insee confirms forecast a GDP (gross domestic product) increased by 0.4% in the fourth quarter after +0.2% in the third and 0.1% in the second.
But the institute is led to revisit to 1.2% (vs. 1.3% previously) growth for the whole of 2016, the momentum will have been based on a single quarter dynamics, the first (+0,6%).
The GDP of France would then evolve at the same pace as in 2015, while the government revised last month its goal 2016 at 1.4% (versus 1.5% previously).
Everything suggests at this stage that it will be the same next year if the uncertainties related to the elections in Europe and the arrival of a new administration in the United States do not start the confidence of economic actors.
The Insee table and +0.3% in the first quarter and +0.4% in the following quarter, with a growth over the whole year which will reach 1% next June 30.
at this level, it will be necessary that the activity increased to at least 0.6% in each of the last two quarters of 2017 to reach 1.5%, the objective on which the government built its budget, which has not happened for nearly ten years.
In the current state, the Insee points out that the stability of its surveys on the business climate, to levels just above their average since fall 2015 is consistent with a growth rate of 0.3% to 0.4% per quarter.
The minister of Economy and Finance, Michel Sapin, has said that the growth forecasts of the Insee were “within the margin of error, 0.1 point near” the objectives of the government.
But he insisted on the fact that the forecasts of the Insee employment “we provide the level of 2008″. “The employment effects of the crisis are now blotted out by the results of the creations of jobs in the field merchant”, he said during a press briefing.
Despite the pace slow growth of the French economy, the private sector has created almost 180,000 jobs over the twelve months to end September, the highest total since the beginning of 2008.
Insee sees the effect of the measures for the “enrichment of job growth” as the tax credit competitiveness, the pact of liability or the premium for hiring in SMES. It will remain significant although mitigated somewhat by 2017, with 60,000 creations net job expected in the first half.
As a result, the rate of unemployment in the ILO sense would amount to 9.6% in metropolitan France at the end of 2016 and 9.5% at the end of June 2017, compared to 9.9% at the end of 2015.
In the meantime, the improvement in the economic situation of the end of 2016, is expected to be driven by a rebound in household consumption and business investment, which have accused the second and third quarters the backlash of their beginning of the year, very dynamic.
He would continue in 2017 even if the purchasing power of households is known to slow down slightly due to a rise in inflation, linked essentially to the dissipation of the past effects of the decline in oil prices.
another positive factor is the restart of the world demand addressed to France, expected in particular from the euro zone, especially Germany.
It should be reflected on the external trade, which has experienced a year 2016 to be difficult, its contribution to growth is estimated at 0.6 points of GDP, compared to -0,3 in 2015.
agriculture, with a decrease in production of more than 6%, will have cost his side to the French economy by 0.2 percentage points of growth. It could recover by as early as 2017 if the weather conditions are back to normal, predicts the Insee.
The institute also insists on the rebound of the construction sector after the dark years 2013-2015, which is expected to continue and is also expected to again contribute positively to growth.
(with the contribution of Marc Joanny, edited by Yves Clarisse)