French economy to shrink 2.5%

PARIS - THE French government expects the economy to shrink by 2.5 per cent this year, Prime Minister Francois Fillon said Wednesday, updating the finance ministry's previous estimate of 1.5 per cent.
'Two point five is the figure which today looks probable but what I'm looking out for is the moment when things will begin to turn around,' Mr Fillon told France Inter radio, confirming a negative growth estimate by the French central bank.
Mr Fillon's admission brought the government's estimate closer to that of independent experts, who viewed the finance ministry's prediction of a 1.5 per cent fall in Gross Domestic Product in 2009 as optimistic.
In March, the Organisation for Economic Cooperation and Development, for example, predicted that French GDP would fall by more than three percent this year as the effects of the global financial crisis take their toll.
'We are planning on the basis of a recovery, which will no doubt be slow, in 2010,' Mr Fillon said, promising that the government would not seek to raise taxes until the economy was firmly back on track.