In 2024, foreign trade was the almost sole engine of French growth, according to INSEE. At the end of September, it represented almost 0.9 points of the increase in GDP, forecast this year at 1.1%. In a country more accustomed to record trade deficits, the configuration is unusual. It surprised even Bercy and distorted its tax revenue forecasts.
Airbus saves the day
French exports benefited from the restart of Airbus deliveries, which fell to their lowest levels at the end of the pandemic, while imports declined. The phenomenon could continue for a few more months, while the sector struggles to increase its production rates. But gradually, the catch-up is running out of steam and few engines are ready to take over. In 2024, public spending constituted the only support for domestic demand. We should not count on it for next year, given the budgetary effort of 60 billion euros announced by the government.
The traditional engine of growth, consumption remains desperately sluggish. At the beginning of September, INSEE anticipated signs of improvement, particularly in the purchase of agri-food products, while inflation was falling faster than expected and the job market was holding up. But budgetary measures could disrupt this scenario. Ditto on the investment side, where “companies seem to be pressing the brakes more and more,” according to the statistics institute. The drop in interest rates will only produce its effects in several quarters. Until then, French growth will have to rely on very little fuel.
You are reading an article from L’Usine Nouvelle 3736 – November 2024
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Source: www.usinenouvelle.com
