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IMF downgrades forecast on France

The International Monetary Fund (IMF) has downgraded its forecast for the French economy in 2013, saying the country needs structural reforms to avoid falling even further behind other European countries.

In its regular report on France’s economy, published on Tuesday, the IMF predicted the GDP to contract by 0.2% in 2013, down from previously expected drop of 0.1%. IMF says France should apply reforms to its financial and labor market as decreasing productivity and profit margins are causing a growing gap between France’s competitiveness and that of its neighbors.

On May 15 it was announced that France had slipped back into recession as the economy shrank by 0.2% in Q1 2013. 

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