Raffarin admits jobs defeat but stands by growth

11th April 2005, Comments 0 comments

PARIS, April 10 (AFP) - French Prime Minister Jean-Pierre Raffarin stuck to the government's economic growth target of up to 2.5 percent this year, but warned high oil prices would delay much needed new job creation.

PARIS, April 10 (AFP) - French Prime Minister Jean-Pierre Raffarin stuck to the government's economic growth target of up to 2.5 percent this year, but warned high oil prices would delay much needed new job creation.

In an interview in Monday's regional daily Nice-Matin, Raffarin noted how analysts had underestimated France's growth rate last year, forecasting it at 1.7 percent, while statistics released last week put it at 2.4 percent.

"The pessimists are not always right. So a figure between 2.0 and 2.5 percent is effectively a reasonable prediction," he added.

The government initially came out last autumn with a forecast of 2.5 percent economic growth for this year, but the finance ministry last month cut it to 2.0-2.5 percent.

Analysts have been sceptical of the 2.5 percent figure, generally foreseeing growth of 1.8 percent, while the European Commission has forecast France's economy will grow by 2.0 percent this year.

Raffarin also spoke of the government's promises to lower taxes and tackle unemployment.

He said the government was still committed to lowering personal income taxes but further steps would have to wait until 2006 and would "depend on how the economy was going".

Efforts to bring unemployment below 10 percent had been hit by what Raffarin called "the new oil crisis" and would "now be delayed by some months".

The centre-right government has set reducing France's unemployment of 10.1 percent as one of its economic priorities for this year.

© AFP

Subject: French News

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