France is a major economic and cultural powerhouse of Europe which is a preferred destination by many to have a fulfilling work-life and enjoy a wonderful lifestyle. From being the fashion capital to being famous for French wine and the French language, this country has many great experiences to offer. Historic monuments like the Eiffel tower and the opportunity to do so many outdoor activities after work adds to the appeal of this country.
The performance of the French economy in the past year and this year so far can be assessed to understand where the country stands with regards to offering you a fruitful immigration plan.
France was ranked as the 7th largest economy in the world. It came in the rankings just behind the UK and India. The country’s recovery from the economic crisis in 2008 has been slower than the rest of Europe. The fragility of France’s economy had contributed to one of the sharpest economic contractions among EU member states. The COVID-19 pandemic and the resulting crisis were the reasons for this scenario.
France’s GDP growth reduced by close to -19% in the second quarter of 2020 as per IMF’s estimates. By the closure of the year 2020, the output of the French economy declined by -9.8%. Economic activity had rebounded in the third quarter of 2020.
In IMF’s October 2020 forecast, a 6% growth in GDP was forecasted in 2021. Going ahead, this was estimated to slow down to 2.9% in 2022. This, however, will depend on the recovery of the global economy post-COVID-19.
The fiscal stimulus measures introduced by the French government will benefit private consumption and investment activity. Firming global demand could boost exports too. Nevertheless, the concern of a delay in the recovery of the French economy lingers in case the COVID-19 pandemic crisis prolongs into 2021.
IMF has revised the GDP growth projections of France in January 2021. It has been set at 5.5% in 2021 and 4.1% in 2022.
Undoubtedly, France was one of the worst affected countries in 2020 owing to the COVID-19 pandemic. Stringent lockdown measures were implemented in March and October 2020. The budget was also amended many times to adapt to the crisis. A large emergency support package was adopted. It focused on extending support to firms and households by providing liquidity and preserving jobs.
The result was that the budget deficit rose to –4.5% GDP in 2020 from –2% GDP in 2019. In 2021, the budget deficit is expected to remain at –4% GDP. In 2022, it’s forecasted that the budget deficit will be –3.8% GDP.
France has the deployment of COVID-19 vaccination is among the top priorities of France in 2021. France is also prioritizing
- The implementation of the recovery plan to support French businesses
- Facilitating the plans outlined in Plan de Relance to bring about green and digital transitions
France is also facing structural challenges on top of the challenges of a prolonged health crisis in 2021 owing to COVID-19. These include:
- high structural unemployment
- weak competitiveness
- high public and private debt burdens
The policymakers in France are doing a tough job at tackling high unemployment rates. This concerning scenario is especially seen among youngsters in France.
Before the COVID-19 struck, France’s unemployment rate was declining. But in 2020, after the pandemic came, unemployment touched an estimated 8.9%. In 2021, this rate is expected to increase to 10.2%. Only in 2022, this rate will decline to 9.5%.
As of now, social mobility in France continues to be low. Also, the employment rates of many disadvantaged groups are not very impressive. France is using the labor reform passed in 2017 to introduce more flexibility into the labor market.
Talking about employment sectors, it’s notable that the agricultural sector of France is the largest in the entire EU. France accounts for 1/4th of the EU’s total agricultural production. The agricultural sector employs 2% of the population. You may wonder when you know that this sector represents only 1.6% of France’s GDP.
France’s manufacturing industry employs 5% of the country’s population. This sector is highly diversified too. However, for now, France is going through a process of de-industrialization. Hence, many activities related to this sector is been outsourced. The industry represents 17.1% of the country’s GDP. The important industrial sectors in France are automobile, aerospace, electronics, weapons, and telecommunications.
France’s tertiary sector employs 78% of the active workforce of the country. It represents 70.2% of the country’s GDP. France, the leading tourist destination of the world, presents the opportunity to you to explore its rich cultural and gastronomic heritage. Every tourist who arrives here on a tourist visa love to shop in France and the tourism industry is a major employer for skilled workers.
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