Europe

French economy bounces back from COVID crisis growing 7% in 2021

France had its strongest economic growth in five decades as its economy grew 7% last year after a record recession due to the pandemic.

The performance of Europe’s second-largest economy exceeded forecasts from the country’s statistics institute and the Bank of France. It was driven by the reopening of several sectors after severe health restrictions during the first part of the year.

Finance minister Bruno Le Maire hailed a “spectacular rebound” that “erases the economic crisis” linked to COVID-19.

“In the fourth quarter, the French economy has exceeded the wealth it had in 2019 and recovered its pre-crisis level,” he said.

Yet the GDP remains “1.6% below its average level in 2019”, the statistics institute INSEE said, in a sign that 2021’s growth did not represent a complete return to normal.

Household consumption returned to pre-crisis levels in the fourth quarter of the year, despite health restrictions in early 2021.

Investment by households, businesses and local authorities rebounded by 11.6%, well above its 2019 level.

Foreign trade continued to recover in 2021, INSEE said, but on average exports and imports remained at a “particularly low level in 2021” below their average levels in 2019.

The economic recovery comes at an important time for French President Emmanuel Macron who is expected to run for a second term in the April presidential election.

France has this year been logging record-high COVID-19 cases due to the Omicron variant. The government this week imposed a vaccine pass, restricting access to much of public life to those who are jabbed or recovered from COVID-19.

But it has resisted placing additional restrictions on certain sectors amid the crisis.

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