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France Economic Snapshot

09.04.2019 Economic Survey of France

Global economic conditions, monetary policy and structural reforms have supported exports and investment in recent years. However, global uncertainties and the effects of social unrests weighed on activity in 2018. 

Consumption and growth will benefit from a boost in households’ purchasing power. GDP growth is expected to remain around 1.3% in 2019-20. 

Slowing productivity gains and weak employment rates have reduced GDP per capita growth. Growing public spending has kept taxes high, weighing on disposable income. 

Expenditure control objectives have not made it possible to sustainably reduce the level of public spending, which remains high, despite a recent inflection.

The low-skilled, young and older workers have particularly low employment rates. The low level of qualification of part of the labour force combined with tight labour market regulations have reduced access to employment.

The stock of public capital is extensive and the perceived quality of infrastructure is high. Yet, in some sectors such as rail transport or health care, a lack of maintenance has hampered the efficiency of existing infrastructure.

Global economic conditions, monetary policy and structural reforms have supported exports and investment in recent years. However, global uncertainties and the effects of social unrests weighed on activity in 2018. 

Consumption and growth will benefit from a boost in households’ purchasing power. GDP growth is expected to remain around 1.3% in 2019-20. 

Slowing productivity gains and weak employment rates have reduced GDP per capita growth. Growing public spending has kept taxes high, weighing on disposable income. 

Expenditure control objectives have not made it possible to sustainably reduce the level of public spending, which remains high, despite a recent inflection.

The low-skilled, young and older workers have particularly low employment rates. The low level of qualification of part of the labour force combined with tight labour market regulations have reduced access to employment.

The stock of public capital is extensive and the perceived quality of infrastructure is high. Yet, in some sectors such as rail transport or health care, a lack of maintenance has hampered the efficiency of existing infrastructure.

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Executive Summary

 

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