French Economy Registers A Drop In GDP Of 8.3%

French Economy Registers A Drop In GDP Of 8.3%

The French economy fell 8.3% in 2020 , a year marked by the coronavirus pandemic and the restriction measures dictated by the Government to stop it, the National Institute of Statistics (INSEE) indicated this Friday.

In the fourth quarter, the fall in gross domestic product (GDP) was 1.3%, after having recovered 18.2% in the previous quarter, Statistics said in a statement in which it published its first estimate.

At the worst moment of confinement , in the second quarter, the decline in GDP was 11.6%. The fall in GDP in 2020 comes after it had gained 1.5% in 2019.

The data for 2020, the biggest drop since the Second World War, is somewhat lower than what the INSEE had initially anticipated, which was betting on a 9% decline, largely because the economy resisted better in the last three months of the year .

It is also a better figure than the Government was considering, which in an estimate that it described as “prudent” advanced a decline of 11% of GDP.

The last quarter, marked by the second confinement decreed by the Government to stop the covid, the economy contracted by 5% compared to that registered in the same period of 2019. But in the second quarter, in which the confinement was harder, the fall had been 18.8% compared to the same period of the previous year.

The second lockdown was especially noticeable in private spending , which fell 5.4% after rising 18.2% in the third quarter.

Savings continued its recovery, with a rise of 2.4% after the 24% improvement in the third quarter, which translated into a negative contribution of 2.7 points to GDP from total domestic demand in the fourth quarter, after being positive of 19.4% in the third.

The foreign trade continued its recovery with a second consecutive quarter of improved exports above imports . The former rose 4.8%, after the improvement of 21.9% in the third quarter, while imports rose 1.3%, after 16.2% in the three previous months. In total, foreign trade contributed positively with 0.9 points to GDP, one tenth more than in the previous quarter.

Variations in stored products also contributed positively, 0.4 points, after a negative contribution of 1.7 points in the third quarter.

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