The OECD much less optimistic than Bercy about France’s growth in 2023

The Organization for Economic Co-operation and Development (OECD) forecasts France’s GDP growth of 0.6% in 2023, down from 1% previously forecast by Bercy.

The French economy should grow by 0.6% next year, the OECD forecasts in its latest global projections published this Monday, a level well below the 1% in advance that the Government has, which presents its budget on the same day by 2023. The international institution based in Paris has revised downwards its previous French forecast dating from June by 0.8 points, as well as that of all the States of the euro zone where growth of only 0.3% next year versus 1.6% previously forecast.

Europe is bearing the brunt as it enters its eighth month and has caused energy prices to soar and serious fears about gas supplies as winter approaches. The dizzying rise in prices threatens the activity of a growing number of companies, especially when it comes to renegotiating their electricity or gas supply contracts.

Manufacturing output is at its lowest level in 28 months according to the S&P Global Flash PMI, undermined by “high inflation, excess inventory and falling demand.” The magnitude of the slowdown in the manufacturing sector raises fears of “an imminent generalization of the contraction to the entire private sector”, which increases the risks of a recession in France.

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Although it is betting on more robust growth than previously forecast for 2022 in the euro zone, the OECD warns of “risks of falling production in several European states during the winter months.” France should also suffer the repercussions of the economic decline in its main economic partner, where the OECD predicts a recession next year.

Beyond Europe, it is global growth that will be weaker in 2023 than previously forecast: the OECD now forecasts global GDP growth of 2.2% next year, down from 2.8% forecast again in June. . In addition to the Organization for the Cooperation and[…]

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