OECD forecast backs up France's return to growth
AFP/The Local · 3 Sep 2013, 12:56
Published: 03 Sep 2013 12:56 GMT+02:00
- Minister: France is out of recession (11 Aug 13)
- France to see first 'real' growth in years in 2014 (31 Jul 13)
- IMF downgrades French growth forecast (04 Jun 13)
France's economy got another boost on Tuesday, when the OECD released figures predicting 0.3 percent growth by the end of 2013. This comes after France's own statistics agency INSEE released figures last month showing the country's economy had surprisingly jumped out of recession.
As recently as this spring, both the OECD itself, as well as the European Commission, forecast stagnant growth of merely 0.1 percent this year.
The surprise return to growth was largely thanks to improved domestic consumption, the national statistics agency INSEE said.
The positive figures from INSEE were welcomed by French Finance Minister Pierre Moscovici who said the date "confirms the end of the recession in the French economy".
"It amplifies the encouraging signs of recovery," he added in a statement.
However certain analysts believe any good news for France on the financial front could in fact make matters worse.
"“The impact of these figures could in fact be damaging because they could lessen the pressure on the French government to carry out the necessary reforms," Christian Schulz, an economist from Berenberg Bank told The Local last month.
“This surprise growth could actually make them blind to all the other problems. It’s quite likely France will return to the stagnation we have seen over the last year and half."
In July President François Hollande's claim in a TV interview that the French economy is on the verge of recovery was met with widespread ridicule in the press and by the public.
"The economic recovery is here," Hollande told TV viewers.
The full OECD report on Tuesday predicts third-quarter growth in France of 1.4 percent, and final quarter growth of 1.6 percent.