Despite the uncertainties arising from the political sequence of the summer, the National Institute of Statistics and Economic Studies (Insee) maintains its growth outlook of 1.1% for the whole of 2024, while the euro zone “starts to come out of his torpor”. In the third quarter, the economy is expected to grow by 0.4%, after a first quarter at 0.3% and a second at 0.2%.
Given a forecast of zero growth for the last quarter, the results for the year will therefore be modest. “And we will start the next year with very little momentum”specifies Dorian Roucher, head of the economic department at INSEE, presenting these forecasts on Thursday October 10. The growth gain (i.e. the increase in GDP recorded over the whole year if it was zero during the four quarters) recorded on 1is January 2025 will be only 0.3%.
If it will not make an impression with its vigor, 2024 growth will remain atypical in its composition. The driving force of the French economy this year will be neither household consumption, sluggish at least over the first half of the year, nor business investment, which has fallen like a blast after three prosperous years, nor stocks , rather decreasing. It is foreign trade which plays the role of locomotive, contributing 1.3% to the increase in GDP. Total domestic demand (which combines consumption and investment by households and businesses, as well as consumption by public administrations) contributes, at the same time, only 0.4% to the economy. The destocking effect has a negative effect of almost 0.5%.
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Some clearings
Foreign trade benefits from a double effect. The sluggishness of consumption and the weakness of industrial production at the start of the year initially minimized the volume of imports. Then, exports increased, particularly in three sectors: aeronautics, metallurgy and pharmaceuticals. “We even regained market share”welcomes Mr. Roucher.
Conversely, the poor performer of growth is household investment, in other words new real estate. Weighed down by high interest rates, housing production “removed a tenth of a point of growth per quarter for twelve quarters”recalls the expert. Over the year alone 2024, « the impact on growth is around 0.3 points “, he believes. “It’s a real obstacle, which will gradually lift. »
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