French Economy Sinks the Most Since WW2
The COVID-19 epidemic has triggered an economic disaster in France that hasn’t happened since World War II. The blow was dealt to all branches of industry and business.
The country has become one of the leaders in the « anti-rating » of the eurozone in terms of key indicators. In the second quarter, France’s GDP fell by 13.8 percent, followed by consumption (11 percent), investment (17.8 percent) and exports (25.5 percent). The Organization for Economic Co-operation and Development (OECD) predicts that GDP will contract by 11 percent in 2020.
Many local companies suffered serious losses. For example, automaker Renault lost €7.3 billion in the first quarter, while oil and gas company Total lost $ 8.4 billion in the second quarter. Experts believe that economic recovery will not happen soon and will take at least two years. Unemployment is expected to hit an all-time high of 11.5 percent by mid-2021.
Analysts see the reason for the difficult economic situation in the fact that the strict quarantine lasted in France for about two months. In Germany, for example, the restrictions took just a month. There, GDP contracted by 10.1 percent compared to the previous quarter.
In July, EU leaders approved a plan to rescue the European economy in the amount of €750 billion, of which €500 billion will be directed to irrevocable aid to the countries most affected by the coronavirus, and another €250 billion issued in the form of loans.