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Maderera Bozovich held in July 2024.
This political vacuum at the heart of the EU may hamper
efforts to address Europe's burgeoning deficits and falling
competitiveness. The recent collapse of governments in both

countries was driven by deep political divisions over fiscal
policy. With the political landscape increasingly polarised,
whoever forms the new government in each country will
likely face difficulties pushing necessary tax and spending
proposals through.
Even before the ink was dry on the OECD's forecast of
0.9 percent GDP growth in France in 2025, and one percent
is projected to stagnate in 2024 and grow by 0.7 percent in in 2026, forecasters were revising down their numbers in
2025 and 1.2 percent in 2026. response to the political crisis.

On prospects for the eurozone economy, OECD suggest According to an article in the Times of London, "the French
that lower interest rates and ongoing spending of the Recovery economy is unlikely to collapse but will have to pull out the
and Resilient Facility funds will support investment, while stops to grow by 0.5 percent in 2025".
private consumption growth will benefit from tight labour
markets and further disinflation. Continuing slow recovery in EU27 tropical wood
However, moves towards a more restrictive fiscal stance— furniture imports in Q3 2024
necessary to reduce historically high budget deficits—will After a very slow start to 2024, EU wood furniture imports

dampen growth in some member states. OECD project that from tropical countries continued to make up lost ground in
core inflation in the eurozone will fall from 2.9 percent in 2024 the third quarter.
to 2.4 percent in 2025 and 2.0 percent in 2026. In the first nine months of the year, the EU27 imported
This will provide space for the European Central Bank to 217,300 tonnes of wood furniture from tropical countries with
reduce interest rates to boost growth. a total value of US$914 million.
The OECD forecast of eurozone growth takes account of Import quantity and import value were up seven percent
political uncertainty in Germany after the failure to conclude and four percent respectively compared to the same period
negotiations on the 2025 budget and the fall of the coalition in 2023.
government in November. In the first nine months of 2024 compared to the same

However, the forecast came before the collapse of the period in 2023, EU27 import value of wood furniture increased
French government on 4 December 2024 after Prime Minister from Vietnam (+12% to US$385.1 million), India (+12% to
Michel Barnier was ousted in a no-confidence vote. US$195.0 million), Malaysia (+20% to US$68.9 million), and
As things stand therefore, neither France nor Germany, the Philippines (+2% to US$6.2 million).
the EU's two largest economies which together account for However, import value fell from Indonesia (-12% to US$240.5
over 40 percent of the bloc's GDP, has a sitting government. million), Thailand (-32% to US$10.6 million), and Mexico (-20%
Germany is expected to hold a federal election on 23 to US$2.6 million). EU27 wood furniture imports from all other

February 2025, but in France there can be no new assembly tropical countries were negligible during the period. FDM
elections until at least twelve months after the snap election ENQUIRY NO. 1002