IMF sees France 2015 growth at 1.2 pct

The French economy is expected to grow by 1.2 percent in 2015, accelerating from a rise of 0.4 percent recorded last year, the International Monetary Fund (IMF) said on Tuesday.

"After almost four years of near-stagnation, we project real gross domestic product (GDP) growth to rise to 1.2 percent this year, above the government's forecast," the international organization said.

Following a meeting with French leaders, the IMF attributed the projected growth expansion to cheap oil prices, a depreciated euro, and historically low interest rates.

However, "France's growth potential still appears much weaker than before the crisis," it noted, blaming wane investment, high unemployment, and rising public debts.

Hailing the government's cut on labor charges to encourage recruitment, the IMF recommended further efforts to fix the country's "fundamental economic problems: high structural unemployment, low potential growth and record high public spending."

In this context, the international lender suggested further structural reforms to trim public spending and limit the growth to inflation.

Furthermore, it pointed to the need to "maintain the momentum on supply-side reforms to restore competitiveness and encourage investment, including by removing obstacles to enterprise growth," in addition to improved flexibility for social partners and facilitating the hiring of low-skilled, young, jobless people.

Beating grim estimates, France, the second largest economy in the single-currency bloc, quickened its national wealth by 0.6 percent in the first quarter of the year, outpacing for the first time its European partners which reported 0.4 percent growth.

Following the better-than-expected economic performance, the government anticipated the French economy to expand more quickly than predicted this year, with the GDP now forecast to be more than 1.0 percent compared to 0.4 percent in 2014. Endit