Rus News Journal

Olland has not kept a rating

Moody’s has punished the president of France for a sluggishness

Agency Moody ’ s has lowered a sovereign rating of France on one step, with Aaa to Aa1. President Francois Olland for the first half a year in power not only has not succeeded in reforms, but also has made some steps back in a question of strengthening of competitiveness of national economy, analysts believe. In the conditions of almost zero growth of gross national product intermediate term forecasts of economic development of France cause serious concern.

“ the Principal cause of decrease in a sovereign rating of France on one step is threat to economic growth and, hence, to system of public finances which continuously is exposed to structural economic calls. Here it is possible to add absence of flexibility on a local labour market and low level of innovations which are a consequence of proceeding loss of competitiveness and erosion it is export the focused industrial base of the country “ — it is told in report Moody ’ s.

the Decision of agency has not surprised the markets: authoritative magazine The Economist has devoted the last number to problems of the French economy, having placed on a cover the image of the French baguettes stylised under burning dinamitnuju a draught. News about rating decrease has appeared in some days after the French authorities announced structural reforms, having suggested to lift partially the VAT and having allocated 20 mlrd euro for reduction of cost of labour for local business. By estimates of the government, this sum should reduce expenses of the companies for payment on the average to 6 %. However, as experts confirm, these measures have appeared too overdue.

“ The sounded reforms, undoubtedly, are a step forward, however before Olland has had time to make some steps back. For example, the decision on surtax increase, too generous social expenditure, and also cancellation of some pension reforms of times of Nicolas Sarkozy — all it has not added competitiveness to the French economy. Actually Olland has been punished for conducting wrong economic policy “ — the senior economist Berenberg Bank Christian Schultz has told daily. In its opinion, one of the basic directions of development of the French economy the next years there should be a gradual decrease in a role of the state. Now the governmental expenses make to 56 % of local gross national product though the average index on an eurozone hardly holds out to 49 %.

the Separate place in the list of necessary reforms of analytics give to change of the labour legislation in favour of employers, many of which experience serious difficulties in business of hiring and dismissal of employees. “ considering absence of economic growth (and next quarter we even predict gross national product reduction), the authorities should give more attention to a current condition of a labour market. Unfortunately, many reforms of such character are only at a discussion stage while ruling socialists are anxious only by increase of tax rates. It negatively affects investment appeal of the country “ — the main European economist Societe Generale James Nixon is assured.

Olland, however, urges not to do hasty conclusions, and to judge its affairs only after the lapse of all presidential term. Almost right after introductions into a post he has warned the public that on economy reforming it is required at least two years, and the clear victory over structural deficiency will occur only by 2016. Analysts do not exclude similar succession of events. “ if all goes smoothly by 2016 France can return itself the highest rating “ — it is assured g - n Nixon.