France: 2019 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for France

IMF Staff Country Reports, July 24, 2019

Source details

Canonical URL: France: 2019 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for France

The French government revamped vocational training and professional development to foster labor market participation, especially for low-skilled workers, following key labor tax and labor code reforms enacted in its first year in office.
The report highlights the importance of carefully assessing the trade-offs and the proper sequencing of structural reforms and fiscal consolidation.
The government’s structural reform agenda is being put in place and growth is expected to gradually return to its potential level over the medium run.

Elevated external risks: a disorderly Brexit, trade tensions, and a softening of activity in the euro area.
Domestic risk: a slowdown in the domestic reform momentum.

Continue implementation of the government’s structural reform agenda, including vocational training and professional development measures targeted at low-skilled workers.
Carefully assess trade-offs and sequence structural reforms alongside fiscal consolidation to avoid adverse interactions.
Policies should aim at addressing France’s structural challenges (high public debt and spending, rising private sector indebtedness, high unemployment, inequality of opportunity, and sluggish productivity) while preserving reform momentum.

Expenditure, Fiscal policy, Fiscal stance, Labor, Public debt
authority, banking sector, CR, enforcement authority, Europe, Fiscal stance, France-Report on the Observance of Standards and Codes, Global, ISCR, labor market participation, money market rate, reform, unemployment benefit reform

Source: France: 2019 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for France (July 24, 2019).