PARIS (MNI) – France’s entrepreneurs have become more pessimistic
about economic prospects and few believe the new government can turn
things around, according to a survey released Thursday.
The improvement in prospects seen in 1Q have been undermined by
uncertainty over the future of the Eurozone and the stagnation of
domestic activity, explained the pollster Viavoice.
Moreover, doubts about the new government’s ability to renegotiate
the EU fiscal pact and finance upcoming reforms of pensions, salaries
and care for the elderly “create great scepticism,” it said.
On the positive side, the survey of over 500 firms with five or
more employees, conducted in the second half of May, showed that 59% of
executives remained confident in their own businesses; but this was down
from 70% in a comparable survey in February. The erosion in confidence
concerned turnover (down 9 points to 57%), cash flow (down 6 points to
56%) and hiring plans.
As for the domestic economy as a whole, only 24% said they remained
confident, down from 38% in February. Hopes for growth fell to 18% from
23% and for employment to 12% from 17%.
Only 30% of the business leaders believed the new Socialist
government would be able to bolster growth and only 26% that President
Francois Hollande would succeed in renegotiating the fiscal pact. Some
85% doubted that public finances could be brought into balance by 2017.
Viavoice highlighted “a mistrust of the leftist majority”
associated with government spending and ties to trade unions and “a more
general mistrust of the capacity of public authorities after four years
of crisis, which have already torpedoed many initiatives and greatly
limited the leeway for maneuver.”
–Paris newsroom +331 4271 5540; e-mail: ssandelius@marketnews.com
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