Weaknesses and strengths of France in the euro zone : The challenge of reconvergence
2012 Presidential Elections : Facts and Figures - april 2012
16/05/2012
The future of the euro area and France’s economic policies are at the center of debates and Presidential platforms. Coe-Rexecode has put under the scanner the euro zone members to identify the weaknesses of France, but also the strengths on which our country can rely to once again make economic progress.
To allow everyone to evaluate France’s situation in its European environment, Coe-Rexecode has put under the scanner the 17 countries which make up the euro zone.
A set of particularly representative maps, graphics and tables shows the weaknesses of France, but also the strengths on which the country can rely to once again make economic progress.
1- The euro zone : Problems in its divergences
The crisis in the euro zone is the result of economic and financial divergences which became more pronounced between national territories adopting the same currency. These divergences have brought about growing gaps between the national interest rates, a dramatic increase in public deficits and they have led some States to no longer be able to self finance. They are manifest also in the evolution of market shares, foreign trade balances and unemployment rates.
2- France : Weaknesses and delays in adaptation
These divergences and their impact are particularly felt today on our territory by :
- the strongest drop in foreign trade market shares of the euro area,
- a gap of 20% in the evolution over ten years of the unit wage cost with Germany,
- a particularly rapid deindustrialization,
- the heaviest weight of public spending in the GDP among the countries of the euro zone.
3- Opportunities and strengths for France
However, France has a major strength which has been too little emphasized :
- a dynamic demography,
- high work hour productivity,
- a weak levels of working time and the employment rate that can become opportunities for growth as long as the labor market becomes more efficient.
4- Reconverging : Absolute priority for the euro zone
Today, a new convergence is necessary to insure the stability and the viability of the euro zone and to restore growth. This is even the object of the new European treaty on stability, coordination and governance in Europe. For France, this consists, first of all, of the necessity of restoring its financial balance and strengthening its competitiveness.
Downloads
