France: 2020 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for France
IMF Staff Country Reports, January 19, 2021
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- France: 2020 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for France
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Bibliographic details
- Published: January 19, 2021
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781513566894.002
Economic impact and outlook
- France is among the countries most affected by the global pandemic, both in terms of health and economic impact.
- Output is expected to have declined by around 9 percent in 2020.
- A partial recovery with GDP growth at about 5½ percent is expected in 2021.
- Risks to the outlook are large, dominated by the virus dynamics and, together with other risks, tilted somewhat to the downside.
Policy response and fiscal measures
- The authorities put in place a large emergency fiscal package to address the crisis.
- The emergency fiscal package focused on:
- preserving jobs, and
- providing liquidity for households and firms.
- The emergency measures were supplemented by additional stimulus measures to support the economic recovery in 2021 and beyond.
Financial sector and credit provision
- The banking sector entered the crisis with comfortable buffers.
- Together with the support of the ECB’s accommodative monetary policy, the banking sector facilitated the provision of credit to the economy.
- The increased leverage, however, poses solvency risks to the corporate sector.
Key themes and issues highlighted
- COVID-19 and its economic fallout.
- Financial sector resiliency and corporate solvency concerns due to increased leverage.
- Labor market preservation as an explicit policy priority.
- Liquidity support for households and firms as central to the fiscal response.
International Monetary Fund. France: 2020 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for France
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