President Francois Hollande has a “unique” opportunity to revamp the French economy in the remaining four years of his term, the Organization for Economic Cooperation and Development said as it cut its growth forecast, reports Bloomberg.
Europe’s second-largest economy will expand just 0.1 percent this year after failing to grow in 2012, the Paris-based OECD said in a report on France. That compares with 0.3 percent growth predicted in November.
Hollande, whose five-year term runs until May 2017, is struggling to revive an economy ravaged by Europe’s debt crisis and a policy malaise symbolized by more than three decades of budget deficits. While lauding a relaxation of labor rules and a cut in payroll taxes, the OECD said Hollande must not flinch from further plans to trim spending and social benefits.
“France faces serious long-term challenges,” the OECD said. “The political timetable offers a unique opportunity to put in place an ambitious reform strategy.”
The organization’s recommendations include changes to France’s pension and unemployment-benefits systems, both of which Hollande has promised to do in the coming months.
Read more of this report from Bloomberg.