France hopes for growth rebound, no new austerity: minister

19th December 2011, Comments 0 comments

France is hoping for a rebound in economic growth in the second half of next year and is not planning a third volley of austerity measures, Budget Minister Valerie Pecresse said on Monday.

"We hope there will be a return to growth. We believe it could return at any moment because the fundamentals of the French economy are good," Pecresse, who is also the government's spokeswoman, said on France Info radio.

"The goal for us is really a return to growth in the second half," she said.

Statistics agency INSEE warned last week that France is expected to fall into recession, with gross domestic product to contract by 0.2 percent in the final quarter of this year and 0.1 percent in January through March 2012.

Pecresse said that the expected French recession was due to a "global slowdown" in growth which was the result of a "crisis of confidence" in the eurozone.

She said the government was not planning new austerity measures, instead focusing on a return to growth.

"There will not be a third recovery plan for public finances because this is not what France needs," Pecresse said.

"Today what's imperative for us is to support growth."

The French government has sought to reassure investors and maintain its triple-A credit rating with a series of austerity measures, including the announcement last month of 65 billion euros in savings by 2016, on top of a 12-billion-euro deficit-cutting package announced in August.

The government has said it needs to make 100 billion euros in savings to balance the budget by 2016.

© 2011 AFP

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