France to see worst post-war downturn this year: minister

(C) Reuters. FILE PHOTO: French Finance Minister Le Maire gives New Year’s address to economic actors

PARIS (Reuters) – France will likely see its deepest economic downturn this year since the end of World War Two, far surpassing the slump seen after the global financial crisis, its finance minister said on Monday.

Bruno Le Maire told a Senate hearing by teleconference that euro zone’s second-biggest economy would likely contract more than it did in 2009.

“That shows the magnitude of the economic shock we are facing,” he said.

The government estimated last month in an emergency budget update that the economy would contract 1% this year, but has since indicated that it would have to revise that figure.

With the French economy currently running at two-thirds of normal levels, each month of government-imposed confinement could knock 3 percentage points off of growth, the INSEE official stats agency estimated last month.

Some 5 million French workers – one out of four in the private sector – have been put on furloughs subsidised by the state to avoid mass permanent layoffs, the Labour Ministry said on Monday.