Hollande bullish on French economy

[PARIS] French President Francois Hollande said he expected the French economy to perform better than expected this year and add at least 200,000 new jobs, as the deeply unpopular leader shifts into campaign mode ahead of next year's elections.

In an interview published on Wednesday on the website of Les Echos daily, the Socialist president also repeated a promise made last month to cut taxes by up to two billion euros, a move he said was aimed at helping the "middle classes".

"There is a rebound going on in France and the start of a reversal of the unemployment curve. This is an indisputable fact," Mr Hollande said.

"Our growth will exceed 1.6 per cent this year, which will allow us to create at least 200,000 jobs." Looking ahead to 2017, Mr Hollande was even more bullish, forecasting growth of 1.7 per cent.

The government previously estimated the eurozone's second-largest economy would expand by 1.5 per cent both this year and the next.

Mr Hollande however warned of the repercussions from Britain's shock vote to leave the European Union, which he said could spread beyond the UK and negatively affect eurozone economies.

"The Brexit (vote) will mostly have an unfavourable impact on the United Kingdom and it will be through a possible recession across the Channel that there could be a risk to the eurozone and to France," Mr Hollande said.

To limit the fallout, he called for "a swift and clear European response".

"The shorter the period of uncertainty about the place of Britain in Europe, the more contained the Brexit consequences will be," he said.

Boosted by household spending, France's gross domestic product grew 0.5 per cent in the first quarter of this year, beating analyst expectations, official data showed recently.

The figures provided a rare dose of good news for Mr Hollande, who has record-low approval ratings, and whose government has been grappling with mass street protests against planned job market reforms less than a year ahead of the next presidential election.

Mr Hollande has pledged not to seek re-election if he fails to rein in stubbornly-high unemployment, which is hovering at around 10 per cent.

AFP