France's GPD could fall by 20 percent in the second quarter of 2020, after already declining by 5.8 percent in the first quarter, making the year's economic recession the sharpest since 1948 despite the gradual resumption of the country's economic activity amid the easing of its lockdown restrictions, national statistics agency INSEE announced Wednesday
MOSCOW (Pakistan Point News / Sputnik - 27th May, 2020) France's GPD could fall by 20 percent in the second quarter of 2020, after already declining by 5.8 percent in the first quarter, making the year's economic recession the sharpest since 1948 despite the gradual resumption of the country's economic activity amid the easing of its lockdown restrictions, national statistics agency INSEE announced Wednesday.
"We estimate that based on previous estimates, French GDP would decrease by about 20% in the second quarter of 2020," the INSEE report stated, adding that the fall in GDP in the first quarter was 5.8 percent, making this year recession the biggest since 1948, when the statistics agency was created.
However, the agency warns that such a forecast should be treated cautiously, as there is no clear understanding of how the economic recovery will go.
The report also indicates that although economic activity would rebound after lockdown restrictions are lifted, it would remain below its normal level by approximately 21 percent.
Last month, French Economy Minister Bruno Le Maire forecasted that the country's GDP would decline by 8 percent in 2020. The INSEE confirmed the minister's estimate, saying it would be the case even if economic activity returned to its pre-crisis level.
The report registers a "sharp rebound" in household consumption since May 11, when the lockdown exit began. As many non-essential shops reopened, the level of consumption by households dropped by only 6 percent to its pre-crisis level, compared with a fall of 32 percent in April.
According to the study, France's consumer confidence indicator fell by 2 points to 93 in May, a little further from the critical drop of 8 points in April, a full lockdown month, after 103 in March. The index estimates consumers' attitudes towards the economy and their own financial situations.
As the report states, the French economy experienced a slight improvement of business confidence in May the business confidence index showed 59 points and in April was 53 points, the lowest result since 1980, when the agency set it up.
The French authorities began gradually lifting the two-month lockdown, with a partial reopening of non-grocery stores, educational facilities, entertainment venues and other public places in so-called green areas of the country, less affected by the virus. Highly infected, or red regions, remain under strict supervision and related restrictions.
As of Wednesday, France has confirmed nearly 183,000 COVID-19 cases, the seventh-highest total in the world. The death toll stands at 28,533.
