French economy regaining strength, say ministers

Situation of the French economy – Communiqué issued following the Council of Ministers’ meeting

Paris, 26 August 2015

The Minister of Finance and Public Accounts and the Minister of the Economy, Industry and the Digital Sector made a statement on the situation of the economy.

Over and above quarterly fluctuations linked in particular to energy production and consumption, economic activity has regained strength in France after three years of inactivity, with GDP growth of 1% between mid-2014 and mid-2015.

This trend over the past year is set to continue over the coming quarters, and the government’s growth target for this year is confirmed by the half-year figure, which stood at 0.8%.

Over the six-month period, household consumption was dynamic, driven by historically low petrol prices and more favourable tax changes for households. In keeping with the policy being conducted and the recovery of competitiveness and margins, businesses’ investments are again increasing, while exports have gained pace. Thanks to favourable finance conditions, the measures to support businesses adopted before the summer – like the implementation of the Responsibility and Solidarity Pact – should, under these conditions, make a more marked growth in investment possible. This is the condition for a change of pace in growth so that it settles at a level enabling unemployment to be reduced in the long term. Finally, the construction industry is showing the first signs of improvement, with a net increase, since the beginning of the year, in the number of building permit applications being issued for individual homes, as well as of sales of new homes.

These developments, as well as renewed stability in the Euro Area thanks to the decisions taken on Greece in the summer, should bolster growth, at a time when some emerging economies are experiencing a slowdown and when financial markets have undergone a correction, following sometimes excessive rises./.

Published on 03/09/2015

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