Brussels, 18/02/2005 (Agence Europe) - In its preliminary evaluation of the economic perspectives in G7 and euro zone countries made public on Thursday, the Organisation for Economic Cooperation and Development (OECD) considers that the conditions are now met for accelerating world growth in 2005 despite a slowdown during the last quarter 2004. Growth in the fourth quarter 2004 was significantly weaker than planned in G7 countries and should not exceed 1.5%, as compared to 2.5% foreseen last November. The rise in oil prices and the weakening of the dollar continued to penalise economic growth last year, Jean-Philippe Cotis, Chief OECD Economist, said adding nonetheless that this “disappointment” for 2004 concerned neither anglo-saxon countries nor France. As an annual rate for 2004, the OECD confirmed its economic growth forecast of 1.8% in the euro zone and 4.4% in the United States, but reviewed that of Japan downward to 2.6% (compared to the predicted 4%). The OECD nonetheless considers that the soundness of certain fundamental elements allows one to foresee recovery of activity during the first half of 2005 even if such recovery is not “spectacular”. It stresses that, in the euro zone in particular, the return to household confidence allows increased investment to be foreseen despite the lifelessness of the employment market. The OECD forecasts during the first quarter 2005 growth of 0.4% throughout the euro zone - 0.5% in Germany and 0.6% in France in particular - 0.7% in the United Kingdom, 1% in the United States and 0.5% in Japan. As an annual rate, growth could reach 2% in the euro zone, 2.5% in the United Kingdom, 3.5% in the United States and 2% in Japan.
The OECD nonetheless recommends that the G7 and euro zone countries especially continue to reduce public deficit and pursue implementation of structural reform. If investment recovery in Germany is an essential condition for returning to sound growth in Europe, France could do much better than potential growth of 2%. The French economy has certainly a number of good intrinsic characteristics but the rate of use of work is extremely low. France should be compared to what it could be and structural reforms may contribute to this, Mr Cotis maintains, judging as “appreciable” the measures taken for reforming the retirement system and making the 35-hour working week more flexible.