France used to be referred to as “the sick man of Europe” because of its high unemployment rate and lack of economic reform.
However, that title would now appear improbable. Following a 0.6% rise in the April–June quarter, the French economy expanded by 0.1% in the third quarter of 2023. However, Germany’s third-quarter output decline raised the possibility of a protracted economic downturn.
Experts are applauding France for its recent years of prompt response.
“Our growth figures reflect the several billion euros that French companies have made this year from the sale of cruise ships and planes,” says Philippe Crevel, president of the Paris-based think tank Cercle de l’Epargne and an economist.
Speaking to DW, Crevel noted that there was a structural benefit atop the “ad hoc effect”. He continued, “France has a large service sector, which has achieved good results recently, especially in the area of tourism,” and mentioned that Spain’s economy was experiencing growth at the moment for the same reason.
He went on to say that the German economy is currently feeling “the impact of the stagnating international commerce and a trade row between China, the US, and the EU, in which all sides set up trade barriers.” Historically, the German economy has been dependent on a robust manufacturing sector and exports.
He continued, “High energy prices are another burden, driving up production and transportation costs for the German industry.” Berlin used to be heavily dependent on Russian pipeline gas, but since Moscow invaded Ukraine in February 2022, Berlin has stopped importing this gas. France, on the other hand, produces about 70% of its electricity using affordable nuclear energy.
The impact of climate legislation on the German automotive sector is very significant. “That sector hasn’t adapted to the transition towards electric cars yet — most of their batteries, which are the lion part of electric cars’ added value, are produced in China,” he stated.