French economy picks up but falls short of government's hopes

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Saturday, February 12, 2005

London, UK —After stagnation starting from 2001, the French economy grew at a rate of 2.3% in 2004, with growth picking up especially in the last three months of the year. However, the growth rate falls short of the 2.5% predicted by the French government. The seasonally-adjusted growth rate of 0.7-0.8% in the fourth quarter of 2004 is also the most solid growth since early 2002.

France, and the Eurozone as a whole, has faced economic stagnation since the September 11 World Trade Center attacks, which had profound effects on the global economy. Growth, however, picked up in 2004 and is expected to further improve in 2005. Unlike Germany and Italy, France's economy has shown to be more resilient, even though it too slowed down in 2001-2003.

The government's target for 2005 is 2.5% growth. While the rebound in output is good news for Europe's third largest economy, unemployment remains one of the highest in Europe at 9.9%.