France's economy grew by a stronger-than-expected 0.2 percent in the fourth quarter from the previous three months as corporate investment picked up and domestic consumption remain solid, bringing growth for the year to 1.7 percent in line with the government's forecast.
The INSEE national statistics office said on Wednesday that investment by non-financial corporations grew by 1.4 percent in the fourth quarter, after a contraction of 0.4 percent in the third.
Household consumption, the motor of France's 2 trillion euro economy, slowed slightly to 0.2 percent in the fourth quarter from 0.2 percent in the third, but did not suffer as strong a decline as some economists had predicted.
A Reuters poll of 36 economists had predicted on average a 0.1 percent contraction, with a high of 0.2 percent growth and a low of -0.6 percent.
Unemployment in France is running at a 12-year high with two months until an April 22 presidential first round vote. Europe's second largest economy also posted a record trade deficit of nearly 70 billion euros last year.
Imports declined by 1.2 percent quarter-on-quarter, while exports grew by the same percentage, meaning that foreign trade had a positive contribution to final GDP of 0.7 percentage points of growth.
Each of the three main components of the economy -- foreign trade, household consumption and investment -- had a positive contribution in the last quarter of 2011, Finance Minister Francois Baroin said in a statement. This strengthens the government's forecast for 0.5 percent (growth) this year.
(Reporting By Daniel Flynn; Editing by Richard Borsuk)