14 Jun 2005

Report paints gloomy picture of French Polynesia's economy

9:21 pm on 14 June 2005

There has been a gloomy assessment of the French Polynesian economy during the first three months of this year.

A report by the French body in charge of issuing the French Pacific currency says jobs continued to be lost in the retail and hotel sectors partly because of the big increase in the minimum wage at the end of last year.

The report by the IEOM institute says businesses are pessimistic as they are under pressure to lower prices while having difficulties in getting paid.

It says the price of vanilla is still depressed while fishing has yet to improve.

Public sector construction is low and the territory's shipyard has no orders for 2005 after the territory's purchase of tuna fishing boats from China.

The report says a government subsidy to replace old cars has prompted a seven-percent increase in vehicle sales.