The International Monetary Fund has warned France's economy is not recovering quickly enough to cut unemployment and debt significantly and more reforms are needed.
The International Monetary Fund is warning France it needs to reform more to create jobs – even as government attempts to modernise the country’s labour laws have sparked protests and strikes.
The IMF, in its annual review of French economic prospects, did raise its growth forecast to 1.5percent this year from a previous 1.1 percent. It sees GDP expansion of 1.75 percent on average in the coming five years.
But the Fund’s experts believe the eurozone’s second largest economy is not recovering quickly enough to significantly cut either its debt or unemployment.
The jobless totals for mainland France remain close to 10 percent.
The IMF also recommended in particular tightening rules for receiving unemployment benefits, a move which would likely anger trade unions.
Reduced government is also high on the Fund’s wish list, along with streamlining France’s vast civil service, keeping wage growth in check, raising the retirement age, reducing benefits by making them increasingly handed out based on need, and reining in health spending.
IMF staff: France’s two main challenges: create private sector jobs & make government spending more efficient pic.twitter.com/fDKiEHUqPc
— IMF (@IMFNews) May 24, 2016