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It holds good. While the French are beginning the summer between gloom and anguish, amid heightened social tensions and renewed terrorist threat, the economic upturn continues. The hexagonal growth should reach 1.6% in 2016, said INSEE in its memo on the economy, Thursday, June 16 So far, the institute suggested that the government’s target, up 1.5% after + 1.2% in 2015, was at hand. But the good figure of GDP growth in the first quarter (+ 0.6%) and the relatively strong outlook for the rest of the year prompted him to raise his forecast.
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After the surge in the first three months of 2016, however, a backlash is to be expected in the immediate future: the french GDP would increase by only 0.3% in the second quarter and then continue on “moderate pace” (+ 0.3% in the third quarter, 0.4% in the fourth). But “Growth has won the tone in the first quarter. It diffuses [now] to employment and, therefore, begins to autoentretenir “, analysis Vladimir Passeron, head of the economy department at INSEE.
the unemployment rate is expected to decline, with the creation of 210,000 jobs this year, a figure well “superior” on the rise in the labor force.
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the government’s economic policy (tax credit for competitiveness and employment pact liability premium hiring in SMEs …) should make it possible to create 95,000 jobs in 2016, after 80 000 a year earlier. The inversion of the curve, rashly predicted by François Hollande to the end of 2013 and which the President has conditioned a possible candidacy to succeed him in 2017, will thus well place but will be moderate. The unemployment rate would increase from 10.2% (9.9% in France) in late March, to 9.8% (9.5% in France), at the end of the year.
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it’s a breath of fresh air for the government, struggling for weeks with persistent social unrest around the labor law. At the risk of a few hiccups. The Secretary of State for the Budget, Christian Eckert, suggested, on Wednesday, during his hearing by the Committee on Senate Finance, growth could reach 1.6% in 2016.
Bercy has denied having grilled politeness INSEE, whose ads were scheduled Thursday at 18 hours.
“Eckert cited this figure to a time when the note INSEE was not output, but because it coincides with the forecasts of our services, “ said the entourage of Michel Sapin.
L the incident however led INSEE to advance a few hours of publication. The Minister of Finance, the faithful head of state, was immediately employed to highlight the reasons for hope sustained improvement.
“In a context international yet lackluster, the French economy grew thanks to strong internal engine “ welcomed Mr Sapin, including insisting that ” the unemployment rate would decline continuously in 2016 to find , end of the year, its level of late 2012 “.
investment Dynamics
the reason for the acceleration of growth this year? The dynamics of investment. One of the first companies, which is expected to increase 4.7% in 2016, a level not seen since 2007. In this regard, “almost all determinants are green,” rejoiced M . Passeron. Of these, the rate of margin businesses almost returned to the level before the crisis: 32.3% on the year, a level it had not reached since 2008
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the low rate policy by the European Central Bank continues to support the financing conditions. Finally, the moral of the bosses, spruced, is above its long-term average in the industry and has significantly improved in the building. Although a slowdown is expected in the second quarter, in turn.
Household investment, that is to say, the housing should stabilize over the year, a first since the crisis. what to allow a “thaw” in the construction sector: the activity would increase it by 0.3% in 2016, after two years of decline (-2.2%)
Another good thing household consumption. After the first engine start of the recovery in mid-2015, then brutally faltered late last year, rebounded sharply in the first quarter (+ 1%), posting its strongest growth for ten years. It was driven by the heating expenditures, the tourism rebound that had paid a heavy price to the attacks of 13 November 2015, but ticket purchases for the Euro 2016 football, and equipment in new TVs before broadcast standard change occurred in April. It would increase 1.6% in total over the year, after 1.5% in 2015.
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the purchasing power should also continue to progress in “apace” (+ 1.7% after + 1.6% in 2015), despite the slight rising inflation, expected at 0.7% in late December, due to the rise in oil prices around $ 50 a barrel (about 44 euros)
the bad thing.: foreign trade, which could severely affect business negatively contributing to growth of 0.7 percent of GDP this year.
“for three quarters exports are marking time, with the gradual dissipation of the effects of the decline of the euro and continued weakness in demand from emerging countries, “ there Insee.C’est the notes “main handicap of the French recovery”
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But Hexagon is not an exception, other European countries also suffer the effects of the emerging slowdown. And if the growth of the euro area valiantly resists (+ 1.7% expected this year), the gloomy international environment weighs on world trade. This has already contracted by 1.7% in the first quarter, when it grew by 1.5% per quarter between 2000 and 2007 …
” in Germany, foreign trade should encumber the growth of 0.5 percentage point of GDP in 2016, “ warns Mr. Passeron.
These do not however take into account the assumption of a “Brexit”. If the British were voting majority, June 23, for a release in the UK of the EU, this would generate “an uncertainty well” that INSEE n ‘ has refused to quantify.
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