Open

Coming up

Don't miss

Replay


LATEST SHOWS

BUSINESS DAILY

Argentina set for deeper recession after default

Read more

THE INTERVIEW

Dr Matshidiso Moeti, Former WHO Deputy Regional Director for Africa

Read more

MEDIAWATCH

Towards a 'Third Intifada'?

Read more

IN THE PAPERS

Germany and Russia discuss secret Ukraine deal

Read more

DEBATE

Iraq's Christians: Nowhere to Run? (part 2)

Read more

IN THE PAPERS

France commemorates a hero of the left

Read more

DEBATE

Iraq's Christians: Nowhere to Run?

Read more

WEB NEWS

Fake Twitter accounts spread chinese propaganda

Read more

FOCUS

What solutions for California's overcrowded prisons?

Read more

  • Israel calls up 16,000 more reservist as Gaza death toll soars

    Read more

  • Kiev declares 24-hour ceasefire to aid MH17 probe

    Read more

  • Video: Inside Hamas ‘terror’ tunnels in Gaza

    Read more

  • Sierra Leone declares state of emergency over Ebola outbreak

    Read more

  • Scores feared dead in India landslide

    Read more

  • Russia ordered to pay further EUR1.9bn to Yukos shareholders

    Read more

  • Iraq's Christians: Nowhere to Run?

    Read more

  • Russia defiant as US, EU unveil 'phase three' sanctions

    Read more

  • US House votes to sue Obama for over-reaching his powers

    Read more

  • Argentina fails to reach deal with creditors

    Read more

  • Women should not laugh in public, Turkey's deputy PM says

    Read more

  • Suspect in Jewish Museum attack charged with 'terrorist' murder

    Read more

  • US rebounds to 4% growth in second quarter

    Read more

  • Rats on the rampage at Louvre museum gardens

    Read more

Europe

Sluggish results for French, German economies in third quarter

© afp

Text by FRANCE 24

Latest update : 2013-11-14

France’s economy contracted unexpectedly by 0.1 percent in the third quarter amid a drop in investment as growth in the German economy, the engine of European growth, slowed to 0.3 percent on sluggish exports, official data showed Thursday.

France’s economy unexpectedly contracted slightly in the third quarter amid a drop in investment as growth in the German economy, Europe's biggest, slowed to 0.3 percent on sluggish exports, official data showed Thursday.

France’s €2 trillion ($2.7 trillion) economy shrank 0.1 percent in the third quarter, slowing sharply from growth of 0.5 percent in the previous three months, the official INSEE statistics agency said Thursday.

German gross domestic product (GDP) expanded by just 0.3 percent in the period from July to September, slower than the 0.7 percent recorded in the preceding three months, the Destatis federal statistics office said in a statement.

Private household and public spending were somewhat higher than in the preceding quarter, as was investment in equipment and construction, Destatis said. "By contrast, the trade balance put a brake on GDP growth,” the statement added. “While imports continued to rise, exports showed little momentum compared with the preceding quarter.”

Slump slows French reforms

French economic activity was widely expected to slow after the economy surged out of a shallow recession in the second quarter because of one-off factors like exceptionally high electricity production brought on by cold weather.

“The new contraction in activity will definitely not help President Hollande to improve his popularity among the electorate – which currently stands at a record low,” said economist Diego Iscaro of consultancy firm IHS.

“Moreover, the weakness of the economy may make it more difficult to achieve consensus to go ahead with the structural reforms the French economy badly needs,” he said.

INSEE reported that domestic demand was flat in the third quarter while investment fell 0.6 percent and household spending rose 0.2 percent.

Stock rebuilding by companies had a positive effect, adding 0.5 percent to output while rising imports and falling exports meant foreign trade put a 0.7 percent drag on the economy.

French Finance Minister Pierre Moscovici said that the weak third-quarter reading was due to temporary factors like a slowdown in aircraft orders and he said he stood behind his growth forecast of 0.1 to 0.2 percent for 2013 overall.

“The productive forces are starting up again, production is recovering,” Moscovici told RTL radio. “We knew the third quarter would bring a pause, it’s not a surprise – it’s not an indicator of decline, it’s not a recession.”

Hollande’s government faces growing concerns about its ability to revive growth in the wake of Standard & Poor’s decision to cut France's sovereign rating to AA from AA+ last Friday over such doubts.

Adding its voice to a growing chorus calling for France to carry out more reforms, the OECD said on Thursday that France was falling behind southern European countries that have overhauled their economies to become more competitive.

(FRANCE 24 with wires)

Date created : 2013-11-14

  • FRANCE

    Hollande booed at Armistice Day commemoration

    Read more

  • FRANCE

    French credit rating at 'AA' after new S&P downgrade

    Read more

  • FRANCE

    Hollande's popularity hits record low, new poll says

    Read more

COMMENT(S)