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After a strong acceleration in 2017, a combination of global and local factors led to a deceleration of economic activity in France in 2018 which could continue in 2019. France’s potential growth remains weak in part because of a rigid labor market and depressing productivity. The government has implemented reforms (capital taxation, labor market) to address France’s structural economic issues, particularly its weak fiscal position and lack of competitiveness. A reform of the retirement system is also planned but its enforcement will probably not be easy in a tense political context.

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