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ECONOMY

Hollande says economy ‘is starting up again’

France's economy, the second-largest in the eurozone, will perk up slightly in the first half of the year but unemployment is expected to stay at record highs, according to forecasts.

Hollande says economy 'is starting up again'
Queues at a French job centre. File photo: AFP

In estimates released late Thursday, the INSEE national statistics office said the economy would grow by 0.4 percent in the first quarter of the year and by 0.3 percent in the second.

The forecasts suggest there is a good chance the French economy will grow faster over the whole year than the 1.0 percent Paris currently estimates.

"The one-percent for 2015, seen by many as unrealistic a few months ago, now looks like the minimum," said Finance Minister Michel Sapin.

However, the more positive growth outlook will be insufficient to drive down stubbornly high unemployment in France, INSEE predicted.

The jobless rate was forecast to hit a 20-year record high of 10.2 percent in mainland France.

Economists and the government estimate that a growth rate of around 1.5 percent annually is required to push unemployment down.

President Francois Hollande has pledged not to seek re-election in 2017 if he does not succeed in reversing the trend of increasingly high unemployment.

"Our economy is starting up again," Hollande said in a speech about the economy on Friday.

"The figures published this morning confirm that. But it is starting up too slowly. We are talking about a growth rate of more than one percent in 2015," said the president.

"But we should have bigger ambitions and we need more than one percent growth to create jobs," he said.

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POLITICS

France vows to block EU-South America trade deal in current form

France has vowed to prevent a trade deal between the European Union and the South American Mercosur bloc from being signed with its current terms, as the country is rocked by farmer protests.

France vows to block EU-South America trade deal in current form

The trade deal, which would include agricultural powers Argentina and Brazil, is among a litany of complaints by farmers in France and elsewhere in Europe who have been blocking roads to demand better conditions for their sector.

They fear it would further depress their produce prices amid increased competition from exporting nations that are not bound by strict and costly EU environmental laws.

READ ALSO Should I cancel my trip to France because of farmers’ protests?

“This Mercosur deal, as it stands, is not good for our farmers. It cannot be signed as is, it won’t be signed as is,” Economy Minister Bruno Le Maire told broadcasters CNews and Europe 1.

The European Commission acknowledged on Tuesday that the conditions to conclude the deal with Mercosur, which also includes Paraguay and Uruguay, “are not quite there yet”.

The talks, however, are continuing, the commission said.

READ ALSO 5 minutes to understand French farmer protests

President Emmanuel Macron said Tuesday that France opposes the deal because it “doesn’t make Mercosur farmers and companies abide by the same rules as ours”.

The EU and the South American nations have been negotiating since 2000.

The contours of a deal were agreed in 2019, but a final version still needs to be ratified.

The accord aims to cut import tariffs on – mostly European – industrial and pharmaceutical goods, and on agricultural products.

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