Many good figures have been published over the past two weeks:  good figures on employment, showing notably that the number of employees in the 4th quarter is stable and that the balance of payments is close to equilibrium in January; good figures on consumption, budget and industrial production.  Does it mean that, finally, after two years of stagnation, the French economy has started off on the right foot? "The recovery is here," said the President of the Republic. Is this really the case?

French exports reached a record level with an average of 37.2 billion over the last three months. Conversely, imports are on the downside and that is good for our trade balance. But this trend is not set to continue. Oil prices seem to have levelled off, and the fall of the euro will mechanically increase the cost of all our purchases outside the euro zone. France will then lose many of the benefits caused by the oil shock. Fortunately, our electricity exports continue to break records thanks to nuclear energy. Their contribution to the external balance has exceeded that of the pharmaceutical industry in 2014, even though electricity prices are depressed across Europe.

The decline in long-term unemployment is good news for those who found employment and the stability of the salaried workforce in the 4th quarter, after three quarters of decline, is also good news. On top of this, INSEE has noticed an increase in the number of temporary jobs (+ 4.7%), which may lead to future hiring (CDD or CDI), as CEOs face more and more orders. But it is too early to conclude that a fundamental shift has occurred. It will take more time to measure the strength of this emerging trend. However, the latest figures related to budget execution and public debt management are much more interesting, and not only with regards to the on-going discussions with Brussels. VAT takings surged in January. They increased by 7% despite last year’s revision of VAT rates and a scope unchanged.  Above all, the revenues increased by 33% compared to the last quarter’s average. Although we cannot rule out the possibility of getting exceptional revenues from the fight against tax fraud, for example, this figure shows that the demand at the end of last year was indeed restarting.

The importance of these indicators lies in the fact that they are not corrected by seasonal variations or by the number of working days. These "corrections" made sense when growth was strong because they only play a marginal role. Today, they can be misleading because they deal with decimals yet climate fluctuations, in contrast, are more violent and above all unpredictable. For instance, and despite the corrections, in recent months, industrial production has been much more influenced by an unusually mild autumn than by the satisfaction of internal and external demands.

Regarding the management of public debt, the indicators are spectacular as well. Contradicting rate and inflation forecasts associated with the state budget, France borrowed at negative rates for short-term bonds since the beginning of the year, and has benefited from very low rates for medium- and long-term bonds. The policy implemented by the ECB will maintain this situation, at least until the fall 2016. The debt burden will decline in 2015 as in 2014 and in the coming years, contrary to what is stated in the Public Finance Law. 3.5 billion have been saved in 2014, yet the Public Finance law has announced that the debt burden will increase by 44.3 billion in 2015, and has anticipated an “explosion in 2016 and 2017”: 47.7 billion and 50.1 billion respectively. This is absurd because the fall of interest rates  will produce its full effect during these financial periods, as the new bonds will replace those issued when the rates were three to four times higher.

But here is the glitch: Agence France Trésor continues to offer investors much higher rates. It pockets the difference in the form of premiums, which are in fact the interests that the subscriber pays in advance to the French State, which is supposed to give them back throughout the duration of the loan. Since the beginning of the year, these premiums have reached a record level of € 6.6 billion and 1.95 billion for the single government bond issuance of March 5, and that was before the ECB started its sovereign debt buyback program. The ten-year rate has come down now below 0.4%. Not so long ago, France used to pay 5%.

A more favourable international environment, the strength of our exports, price stability, the return of some confidence among consumers who start spending money again in a context of reduced energy bills (climate, oil prices). And one might add abundant financial savings, expanded by the increase of the stock market that would feed the household demand, when optimism would have returned. The beginning of a recovery is therefore a credible hypothesis. But on one condition: the State must not break this tendency as it did in the Fall 2013.

Let us remember, it was not so far away: a burst of tax increases to finance the CICE, and then the “Responsibility Pact “ in order to reduce the budget deficit (an objective that has not been reached), along with  public salaries, pensions and minimum wage freeze. Yet, recovery was on its way, the unemployment curve reversed for the first time in years, the number of employees was rising, VAT takings were better. But it did not last.

If the State takes full advantage of the lower interest rates with regard to its budget, particularly in its discussions with Brussels, and if it passes on this reduction to economic agents, the recovery may even accelerate.

If the State does not make the same mistakes it did two years ago, if one stops to put down everything that goes well: namely the TGV, despite its excessive number of local stops, the highways, which have the merit to make investments financed by the millions of tourists and foreign carriers that use them, the nuclear energy which ensures supplies for our country at the lowest cost in Europe, then, yes, the recovery has a chance to lead to sustainable growth.

If the State does not give in again, in front of blockers that paralyze investments in large or small infrastructures, or social housing, if it ceases to let the Parliament expand at will the Tax Code and produce texts of several hundred pages in the name of so called “growth liberation”, even though these texts are often inapplicable or their application blocks any economic initiative because understanding them would take too much time - then yes, the economic climate will change and growth will settle at a pace that is likely to reverse the unemployment curve.