France is facing its deepest recession since the end of World War II because of the widespread lockdown to stem the coronavirus crisis, Finance Minister Bruno Le Maire warned today.
“The worst growth figure in France since 1945 was -2.2% in 2009, after the financial crisis of 2008. We will probably be very far beyond -2.2%” this year, Le Maire told a Senate panel.
That figure was subsequently revised to a drop of 2.9%, and France is likely to do even worse than that, the finance ministry clarified to AFP.
“It’s an indication of the amplitude of the economic shock we’re facing,” Le Maire said.
France imposed a nationwide stay-at-home order from March 17 after shuttering all nonessential businesses. Officials have said the lockdown will last until at least April 15.
Statistics office Insee said last month that the lockdown has slashed overall economic activity by 35% and estimated that 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.