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Growth reforms will expand French growth 0.3 pct in 5 years: OECD

Xinhua, September 19, 2015 Adjust font size:

The proposed law on growth and activity, suggesting more flexibility on shops' opening hours in tourist zones and greater competition in closed professions, would help French economy grow 0.3 percent over five years, the Organization for Economic Cooperation and Development (OECD) said Friday.

The economic reforms, proposed by French Economy Minister Emmanuel Macron, would increase the GDP of the euro zone's second largest economy by 0.4 percent over a decade, the think-tank added.

"In the context of a fragile global economy, the Law for Growth, Activity and Equality of Opportunities shows that each economic sector can and must help enhance the dynamism of the French economy," said Angel Gurria, OECD's general secretary.

"There can be no exceptions and the reforms need to be reinforced," he said.

With the controversial economic reforms, the French government wants to let shops open up to 12 Sundays a year from five currently, with more flexibility on opening hours in tourist zones.

It also eyes opening long-distance bus routes and closed professions such as notaries to greater competition, a proposal that triggered demonstrations.

"The synergies between the effects of the reforms and a resulting increase in confidence will be just as important as the continuation of the reforms in the future," the OECD wrote in a note to Macron.

"In order to improve productivity and ameliorate competitiveness, France should adopt new forms of entrepreneurship and new technologies," the note added, saying it was important to reinforce people's skills and protect the most vulnerable.

The OECD hailed the government's moves to inject dynamism in the domestic job market mainly by reforming social dialogue rules and simplifying the labor code.

However, it called for more action to support jobseekers and to implement ambitious reforms in education and training.

In its latest economic outlook, the OECD expected the French economy to grow 1 percent, in line with the government's estimate.

In 2016, the OECD predicted a growth rate of 1.4 percent, below the official target of 1.5 percent. Endit