France lowers economic growth forecast to 5% amid lockdown
The French economy will grow by 5% in 2021, Economy Minister Bruno Le Maire said in a newspaper interview, as a third lockdown to fight the coronavirus pandemic resulted in a downward revision of predictions of the previous government for a growth of 6%. The new forecast was cautious, Le Maire said in comments published in Le Journal du Dimanche (JDD) on Sunday.
“Our fundamentals are solid, we will be able to bounce back,” said Le Maire. French schools and non-essential stores such as clothing chains will now be closed for four weeks, after COVID-19 cases have increased in recent weeks, increasing the number of patients in intensive care units.
Bars and restaurants have already been closed for months, while tourist travel has stalled, although unlike France’s first national lockdown a year ago, construction and manufacturing work is among the sectors of activity still in progress. Like many countries in Europe, France has invested billions of euros to support struggling businesses with state-guaranteed loans, rent support and partial unemployment schemes.
The latest restrictions will force some 150,000 businesses to shut down temporarily, and aid measures in April will cost 11 billion euros, the finance ministry said. The Mayor has repeatedly called on the European Union to speed up the ratification and implementation of its 750 billion euros economic recovery plan.
He told the JDD that France was now unlikely to get the € 5 billion disbursement from this program in July as planned, due to delays. France has its own € 100 billion economic restart program and plans to spend around half of that budget by the end of the year, Le Maire said.
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