French President Hollande confirms France will miss economic growth target for 2013

ATHENS, Greece – France’s economy, Europe’s second-biggest, will grow by less than previously thought in 2013, President Francois Hollande confirmed Tuesday.

While on a six-hour visit to Greece, Hollande said “everyone knows that for 2013, we will not reach our target, which was 0.8 per cent.”

He said a new growth target will be announced by the end of next month.

France is waiting for the European Commission, the European Union’s executive arm, to release its economic forecasts for the 27-country EU on Friday.

Based on those figures and a review by a top French economic advisory panel, the government will be able to produce what Hollande termed “incontestable” estimates by the end of March.

France’s economy stalled in 2012 as a slowdown in Europe dented activity at a time when the government is enacting deficit-reduction measures. France contracted by 0.3 per cent in the final quarter of 2012 from the previous three-month period. If it contracts again in the first quarter of 2013, it will be back in recession — officially defined as two straight quarters of negative growth.

Earlier, French Foreign Minister Laurent Fabius also said his country would have to revise its growth forecast downwards for this year. “At the European level, things aren’t going all that well now, we are going to have to revise downward,” he said on RTL radio.

The economy of the 17 EU countries that use the euro is in recession. In the final quarter of 2012, a contracted by a quarterly rate of 0.6 per cent.