12 Aug 2013

Negative growth expected in France

6:08 am on 12 August 2013

France has revised down its economic prospects for 2013, predicting negative growth for the first time since 2009.

Finance Minister Pierre Moscovici on Saturday said the economy may shrink 0.1% this year, after predicting 0.1% growth earlier this year. But he predicted a rebound of 0.3% growth in 2014.

The International Monetary Fund in June called on France to lower its labour costs and halt tax rises to boost both growth and its competitiveness. The IMF predicts GDP will fall 0.2% this year.

In June, the European Commission gave France two years to trim its budget deficit from 3.7% of gross domestic product at the end of 2012 to 3%.

The BBC reports unemployment in France is currently at 11%.