EU sees France missing deficit target

Updated 08 November 2012
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EU sees France missing deficit target

PARIS: The European Commission sees France missing its target of cutting its public deficit to 3 percent of output next year because of slower-than-expected growth, throwing a deficit-cutting trajectory into doubt.
The EU's executive arm saw economic growth in France of just 0.4 percent next year, half the 0.8 percent level on which the government's 2013 budget is based.
In its autumn forecast, the Commission said that France's budget deficit would fall to 3.5 percent of gross domestic product next year, above the EU target, and would only drop below 3 percent in 2014.
"After three quarters of stagnating GDP and historically low levels of corporate profitability, prospects for an imminent recovery have waned," the report said. "Specific downward risks relating to the French economy weigh on the potential recovery."
The forecast matches International Monetary Fund estimates for growth and deficit reduction and is slightly more optimistic on GDP than a Reuters poll of economists, which predicts growth 0.3 percent next year.
France's 2012 deficit is seen around 4.5 percent of output.
The Commission's forecasts chime with the views of many economists who believe Socialist President Francois Hollande has based his budget on over-optimistic growth targets as the country struggles to rebound from three quarters of stalled output.
In September Hollande unveiled France's toughest budget in 30 years, relying on a combination of hefty tax hikes for companies and the wealthy and checks on public spending to bring the deficit down by 30 billion euros.
Hollande's fiscal credibility is under scrutiny from foreign investors who are concerned France's record-low bond yields do not accurately reflect the fragility of its economy.
Bank of France Gov. Christian Noyer said last month he believed that Hollande's Socialist government would be able to meet the 3-percent target but expressed regret that the government was not cutting spending.
The Commission said that tax hikes programmed in the 2013 budget were likely to weigh on consumer spending as well as employment, holding up recovery next year, while declining competitiveness could reduce exports.
It also highlighted stronger capital requirement for banks as potentially limiting new lending, which would have a knock-on effect for investment and business sentiment on the whole.


World Cup football fakes keep Dubai’s ‘Dolce & Karama’ traders busy

Updated 7 min 5 sec ago
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World Cup football fakes keep Dubai’s ‘Dolce & Karama’ traders busy

  • Dubai's “Dolce and Karama” is the emirate's copycat capital
  • Neymar Jr shirts are proving especially popular with local shoppers

DUBAI: Tucked away in an old residential district and far from Dubai’s glitzy air-conditioned malls, the Karama area of the city is doing a roaring trade in selling World Cup football shirts.

But if you’re looking for the genuine article, you may have come to the wrong place.

Karama is Dubai's copycat capital where the knockoff imitations of the world's most famous fashion brands are sold for a fraction of the genuine price.

Known to some locals jokingly by the epithet “Dolce and Karama,” a play on the Dolce & Gabbana Italian fashion house, this is a place where if you have to ask the price, you probably can afford it.

With three weeks to go until football’s new world champions are crowned, the world’s biggest sporting tournament is keeping the tills chiming on the street that has become notorious for selling everything from fake Luis Vuitton bags to knockoff Ray-Ban sunglasses.

However since the tournament kicked off just over a week ago, it’s been football not fashion, that has put a smile on the face of traders.

Retailing for a fraction of their high-street cost, the copycat shirts — especially those bearing the name of Brazilian superstar Neymar — are flying off the stalls less than week into the tournament, as UAE-based fans who want to don the colors of their favorite team or player, look for bargains.

Mohammad Ashraf has been trading in Dubai’s Karama Shopping Complex for 15 years.

At his store, Mina Fashion, Ashraf said the World Cup has brought a booming trade.

When asked how many shirts he would sell prior to the Fifa World Cup, he shrugged.

“Maybe one, two — maximum five a day,” he said.

But the Indian trader has quadrupled his business since last week’s kick-off.

“Now, we have been very busy,” he said. “We sell at least 20 pieces a day — maybe more,” he said.

His football shirts are a fraction of the cost of the genuine article on sale in Dubai malls where retailers are feeling the pressure from the growth of online rivals, the introduction of VAT and the strong dollar to which the UAE dirham is pegged — that is hitting tourist spending hard.

Karama football shirts sell for about 65 dirhams ($18) in adult size and 55 dirhams for children. But the real deal costs three or four times as much a few miles down the road in the Dubai Mall, the city’s biggest tourist draw.

In Karama, the football shirts of the Brazil, Argentina and Germany teams have been among the biggest sellers.

And the most popular player?

Ashraf said shirts bearing the name of Brazilian footballer Neymar da Sila Santos Junior have been flying off the shelves.

Abdulla Javid, runs Nujoom Al Maleb in the Karama shopping district — a shop selling a variety of knock-off sportswear — including World Cup shirts for men, youths and children.

“They are not real, not branded — branded ones are very expensive,” he said.

“We have shirts for Germany, for Argentina, for Portugal, for Sweden, for Brazil and for Belgium,” he said, pointing to racks of multi-colored football shirts.

Mens shirts retail for about 45 dirhams for adult sizes in his shop and 40 dirhams for youths. For young children, he sells shirts and shorts for a combined price of 30 dirhams.

The World Cup has also been a welcome boom for business.

“Before we sell maybe between five to 10 (shirts) a day,” he said. “Now, at least 20 to 30 pieces a day. It has been very busy. This time is a good time for us.”

Also at Karama Shopping Complex is Zico Sports.

Ahmed Jaber, a 53-year-old trader, said there are good deals to be found in at the shop he has worked in since the 1980s.

He sells football shirts that are both “branded” and “non-branded” — in other words the genuine article and cheaper knock-offs.

He said customers have been happy to shell out for the genuine football shirts for the adult sizes — which he sells for 379 dirhams, but for children, shoppers prefer to buy the fake football shirts, which he sells for about 30 dirhams.

The most popular shirts since the start of World Cup have been for Brazil, Argentina and France, he said, but his shops have an abundance of kit for all competing countries.

When he asked how the 2018 World Cup had been for business, he laughed.

“Not bad at all!,” he said.