Boost for Macron as French economy posts strong growth

PARIS: The French economy chalked up a fourth consecutive quarter of strong growth between July and September, official data showed yesterday, suggesting recovery in the eurozone’s second-biggest economy remains on track.

The national statistics institute INSEE said gross domestic product (GDP) expanded by 0.5 percent in the period, led by a pick-up in household consumption and investment. The French economy had already grown by 0.6 percent in the second quarter and 0.5 percent in the previous two quarters, making this the longest expansion since 2011. The figures suggest President Emmanuel Macron’s government is on course to achieve its target of 1.8 percent growth over the year as a whole.

Maintaining buoyant growth is also central to his aim of bringing France’s deficit within an EU limit of 3.0 percent of GDP this year-for the first time in a decade. “It’s very good news,” said Christian Eckert, former junior budget minister in the former Socialist government that Macron quit to run for president. He predicted the spurt in activity would generate “several billion euros” in extra revenue-a muchneeded windfall for the government which has been hit with a 10 billion euro ($12 billion) bill for overtaxing dividends that could blow its deficit targets off course.

Analysts say France’s turnaround is partly the result of the pro-business policies put in place by Macron’s unpopular predecessor Francois Hollande that are only now beginning to yield fruit.

Macron, elected in May, has taken the policies further with landmark reforms to employment laws governing hiring and firing. Strong growth in Europe as a whole has also given France a shot in the arm. Third-quarter growth in the eurozone was stronger than in France, reaching 0.6 percent.

“President Macron is incredibly lucky, he’s arriving at a time of growth,” Eric Woerth, a leading member of the centre-right Republicans, said. “This growth is not of his doing, it’s European growth,” he added. The real test for Macron’s presidency will be his ability to bring down stubbornly high unemployment, which is running at close to 10 percent. Hollande bowed out after a single five-year term marked by his failure to make an impact on the jobs front. — AFP