French gross domestic product (GDP) shrank by 1.2 per cent in the fourth quarter of 2008, DPA quoted Finance Minister Christine Lagarde as saying late today. The result reflects, "in good part, the significant destocking carried out by companies, a wait-and-see policy in the face of a very uncertain economy and the auto industry crisis," Lagarde said in a press statement. A significant part of these factors are "temporary," she noted. French media said the GDP drop was the largest since 1974, when France had to deal with the first oil crisis. Lagarde also warned that the French economy would contract by more than 1 per cent in 2009. She had previously said that French GDP would grow between 0.2 and 0.5 per cent this year.
