France could be heading for worst recession since WWII, warns finance minister

France could see its deepest recession this year since the end of World War II, due to the coronavirus crisis, Finance Minister Bruno Le Maire warned on Monday.

France could be heading for worst recession since WWII, warns finance minister
Bruno Le Maire. Photo: AFP

“The worst growth figure in France since 1945 was -2.2 percent in 2009, after the financial crisis of 2008. We will probably be very far beyond -2.2 percent” this year, Le Maire told a Senate panel.

“It's an indication of the amplitude of the economic shock we're facing,” he said.

READ ALSO This is the help self-employed people and small business owners can access during lockdown

France imposed a nationwide stay-at-home order from March 17th after shuttering all nonessential businesses. Officials have said the lockdown will last until at least April 15th and will likely be extended.

Statistics office Insee said last month that the lockdown has slashed overall economic activity by 35 percent, and estimated every month of shutdown would cut annual GPD by three percentage points.

Services, heavy industry and construction are all taking big hits, Insee said, as factories are shut and only a handful of business sectors, such as supermarkets and pharmacies, remain open.

A wave of French blue-chip companies have abandoned their profitability targets for the year, while employers' associations have warned that hundreds of smaller firms and shops risk bankruptcy.

The government has pledged €45 billion in loan guarantees and other relief to help companies get through the crisis.

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