The general economic situation in France deteriorated in 2001 as a result of the world and European slowdown, which lead to a weaker external demand and poor investment incentives for companies established in France. Household consumption remained strong and was the only driver of the economic growth during this year. Compared to 2000, real GDP rose by 2 percent. This growth rate, while lower than in 2000, is still over the average growth rate of the European economy (1.6 percent).
The slowdown of the French economy accelerated during the year, as the European economy slowed and uncertainty emerged. However, decrease of unemployment in the first half of the year together with less tension on consumer prices, implied a continuous growth of private consumption. The main sectors benefiting from this situation were producers of durable goods, such as automotive producers.
The degradation of the economic conditions of our main partners implied a downturn in exports, even if the euro remained weak over the year. Combined with low investment rates and destocking behaviours in the industrial sectors, the conditions for a high growth rate in 2001 did not exist.
In an unfavourable economic environment and with ever-growing uncertainty, French production of paper and board products amounted to 9 634 000 metric tonnes in 2001, decreasing by 3.7 percent compared to 2000. This fall in production occurred after two years of growth superior to the long-term tendency, and can be interpreted as an adjustment.
The decrease in production reflected the weakening economic climate in France as well as the downturn of export markets. After a growth of 4.2 percent in 2000, the apparent consumption of paper and board declined by 4.1 percent in 2001. Consumption was burdened by cuts done by converters and downstream industries on their stocks. The evolution of the exports, decreasing by 2 percent in 2001, is a result of the economic slowdown of the major trading partners of the French paper and board industry.
The only sector showing a rise in production was the hygiene paper sector, whose activity was driven by the increase of the household consumption. Its production rose by 2.6 percent to 593 000 metric tonnes, apparent consumption of this grade reaching 687 000 metric tonnes (+2.8 percent). In 2001, the other main sectors experienced falling figures in production.
Due to the cutbacks in advertising budgets, production of graphic papers decreased by 3.7 percent. Over the year, the reduction in the number of pages published in newspapers was not completely offset by the number of daily issues, implying a weaker demand of newsprint papers. Newsprint production dropped 1.9 percent to 1 million tonnes, with an accelerating slowdown which began during the summer.
Uncertainty lead to some reductions on paper stocks by distributors and publishers, reducing demand and, as a consequence, production. Printing and writing papers producers saw a 4.3 percent decrease in their production to 3.3 million tonnes in 2001. This affected all sorts of printing and writing papers (coated, uncoated, woodfree and mechanical). Apparent consumption of this grade decreased by 6.5 percent over the year.
Poor demand in national and international markets implied a -4.7 percent evolution of the production of packaging papers and boards. All grades saw a reduction in their consumption and production: the grade breakdown shows a 5.3 percent fall of the production of wrappings, a 5 percent decrease for the case materials production, and a -3.5 percent evolution for the production of carton board.
However, following some years of high growth rates, 2001 has to be seen as a year of adjustment of activity. Indeed, the long-term growth rate was not broken by this year's figures.
Main French Figures - 2001 (Preliminary)
Thousand tonnes* |
Variations 2001/2000* |
Variations 2000/1999 | |
Production |
9 634 |
-3.7% |
+4.2 |
• French shipments to the French market |
4 733 |
+3.7 | |
Apparent consumption |
10 927 |
-4.1% |
+4.2 |
• Imports |
6 193 |
-3.0% |
+3.6 |
*estimated
Source: COPACEL
The lack of dynamism in the demand for paper and board in 2001 implied a slight erosion of prices during the year. The global index for paper and board issued by INSEE shows a 5.6 percent decrease of the prices over the year. This erosion was endured by all the main paper grades. However, the level of prices at the beginning of 2000 burdened the average for this year, implying a higher average price level for the year 2001 (100.6 in 2001, 97.7 in 2000). As a consequence, the decline of the turnover of the industry was limited to 0.6 percent at €6.8 billion.
Regarding raw materials, the main event during the year 2001 was the significant and regular decrease of the NBSK pulp price over the first nine months of the year. However, the continuous appreciation of the dollar towards the European currency reduced the real impact on French buyers of market pulp.
The French prices for recovered papers ended their decrease at the end of the first quarter, which originated from the middle of 2000, and remained stable during the rest of the year.
Following a gloomy 2001, marked by recession in some of the main economies, and by increasing uncertainty on economic and political grounds, 2002 should imply a return to positive growth rates in the main industrialized countries. Nevertheless, the date and the scope of this recovery are not yet known. The probable recovery of the United States economy will also give pace to growth in world trade and the European economy.
That is why most scenarios adopted by experts project a GDP growth of 1.4 percent to 1.6 percent for the French economy, with a growth rate accelerating during the year.
Discussions are under way in France with the government, on possible voluntary agreements of some companies, to reduce their greenhouse gas emissions. These engagements could be accepted by the government. However, with the forthcoming elections in France, it would be impossible to conclude this issue. Moreover, the Green party is still asking for the application of a tax on CO2 emissions.
The French system of certification obtained the Pan European Forest Certification Scheme (PEFC) label in July 2001. The first certified areas are Burgundy and Normandy (January 2002). The first certified products will have to respect two conditions:
• the owners of the forests from where they are issued must have adhered to the PEFC-France system.
• the transformers of these products must have an approved control line, verified by an independent person.
The first certified products will be gradually available during the first half 2002.
39 Based on preliminary figures