The French economy sustained healthy growth in the fourth quarter of 2018, according to figures released by the national statistics agency today. It is the first positive economic expansion in France since the start of the year, potentially offering a much-needed lifeline to a country beset by slowed industrial activity and global economic stagnation.
France’s Insee statistics agency reported that gross domestic product increased by 0.3 percent in the fourth quarter compared to the previous quarter. This marks the largest economic growth for the nation in the last three quarters and the highest quarterly growth since the first quarter of 2017.
Insee also reported a strong 0.7 percent growth in consumer spending in the fourth quarter, as both private consumption and investments grew. This rise in consumption is an encouraging sign for the nation, as consumer-driven economies account for two thirds of the French economy.
However, a number of domestic economic issues remain to be resolved. In addition to a nine-month high in the nation’s unemployment rate, a number of sectors in France, such as auto-manufacturing and agriculture, remain weak due to global overall economic insecurity.
Furthermore, the country’s poverty rate reported by the Organisation for Economic Co-operation and Development (OECD) remains particularly high at over 20 percent. To combat this, the government is focusing on job creation and also engaging in a series of structural reforms to reduce barriers to labor market entry and increase competition within the economy.
The encouraging growth observed in the fourth quarter of 2018 is a hopeful sign for the French economy and could point towards a much-needed resurgence in investment, consumer confidence and growth. However, a number of economic issues must still be addressed in order for this growth to be sustained into the long-term.
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