France at risk of economic downturn as Yellow Vests protests resurge

Tuesday, 2019-03-26 12:00:32
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A protester stands on a burning barricade during a demonstration by the "yellow vests" movement in Paris, France, March 16, 2019. (Reuters)
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NDO – After days of calming down, the ‘yellow vests’ protests in France resurged last week, putting President Emmanuel Macron’s government in the face of serious challenges. In parallel with the unrest caused by protests and riots, the French economy is currently at risk of a serious downturn.

The ‘yellow vests’ protests had subsided by late February and the “warm sunshine” had returned to French politics as public opinion polls showed that President Macron’s reputation rose again. However, the “dark clouds” are back as demonstrations and riots have been taking place fiercely across French streets in the last two weeks.

During the rally in the 18th week since its outbreak in 2018, the ‘yellow vests’ force gathered 32,300 people throughout France, about 28,600 more than the number of participants in the previous protests. Over 5,000 policemen were deployed, but they could not prevent hundreds of aggressive demonstrators from carrying out acts of violence and sabotage along the Champs-Elysees Avenue, burning and pillaging more than 100 stores within around seven hours. After that, the protests continued to break out widely over the past weekend. Protest groups gathered in many areas throughout Paris and a number of other major cities across France.

In response to the ‘yellow vests’ protests last weekend, the French government mobilised soldiers in the anti-terrorism units to support security forces in ensuring security at public buildings in Paris. Thousands of police officers were deployed to many locations in central Paris and cities all over the country. Paris police had to mobilise both armored vehicles and water cannons at the Arc de Triomphe. The entrance to Concorde Square, near the Presidential Palace and the French Parliament building, was blocked. Two unmanned aircraft are also constantly patrolling in the sky of Paris to assist security personnel to monitor the activities of protest groups.

Alongside the rising protests and riots, the French economy is also facing many challenges. France’s economic growth is at risk of declining. Although the French Ministry for the Economy and Finance still retains its forecast of a 1.7% growth rate for the French economy this year, experts from the National Institute of Statistics and Economic Studies (France) and many other analysts have warned that ‘yellow vests’ protests will cause negative impacts on the economy. Accordingly, the movement has been resulting in serious consequences. Meanwhile, in its latest quarterly forecast, the Bank of France (BoF) stated that the French economy will grow 1.5% in 2018 and 2019, lower than the previously predicted rate of 1.6%. The forecast figure does not account for the EUR10 billion (US$11.36 billion) tax cut introduced for 2019 and the supplementary spending recently announced by President Macron to give in to demonstrators’ demands. According to BoF Governor François Villeroy de Galhau, the protest movement has “burdened” and affected France’s economic activities since late 2018.

The aforementioned fact is putting France at risk of entering a vicious circle with social disorder and the economy being wavered. Meanwhile, the stagnant economic situation threatens to cause discontent among the people, thus leading to a growing wave of protest.