France sees slower 2012 growth

13th April 2011, Comments 0 comments

The French economy will grow 2.25 percent next year, down from an earlier estimate for 2.5 percent, Economy Minister Christine Lagarde said.

"Our forecast for two percent growth in 2011 is now judged to be realistic even though the government has been attacked for some time on that," Lagarde told Thursday's edition of business daily Les Echos.

"For 2012, we expect a pick up but we have decided to be cautious in setting the target at 2.25 percent instead of the previous 2.5 percent," she said.

She said the slight downgrade was based on the view that overseas demand for French goods could be a bit less than expected.

The new forecasts are also based on an oil price of $101 per barrel, up sharply from the earlier $77, Lagarde said.

The minister noted that France's total debt burden in 2012 would also be lower than expected, at 86 percent of Gross Domestic Product, down from the 87.4 percent envisaged previously.

It would then fall to 85.6 percent in 2013, she added.

Lagarde previously cut her estimate for this year's budget deficit, a key measure of a country's financial health, to 5.7 percent of GDP from 6.0 percent.

© 2011 AFP

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