France’s protests are hurting the economy at a crucial time

Not a time for shop.
Not a time for shop.
Image: Reuters/Stephane Mahe
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For the fourth weekend in a row, the busy pre-Christmas shopping period was disrupted in France as the gilets jaunes (yellow vests) anti-government protest movement took to the streets.

This morning (Dec. 10), France’s central bank downgraded its economic outlook for the fourth quarter, forcasting just 0.2% growth in the quarter—half its previous estimate. Meanwhile, the protests, sparked by president Emmanuel Macron’s now-scrapped fuel tax, are said to have ravaged retail and restaurants that fall into the small-to-medium business sector. Francois Asselin, head of the CPME confederation of small- and medium-sized businesses, wrote in yesterday’s Journal du Dimanche that the movement will cost these business owners an estimated €10 billion ($11.4 billion).

An estimated 125,000 protesters took to the streets. On Saturday, Paris’s top attractions were all shuttered for tourists and locals alike, while touristic cities like Bordeaux and Toulouse were also affected. This, along with some Metro station and local shop closures, prevented consumer spending on what would otherwise be a crucial revenue weekend. Tourism-wise, some airlines and operators such as low-cost carrier easyJet are offering to waive rebooking fees for travelers looking to reschedule their trips on the advice of tourism officials. On Monday, stocks of France’s leading hotel and retail companies were down.

“It’s a period when commerce is usually brisk, just before Christmas—but this, this is a catastrophe,” Finance Minister Bruno Le Maire was quoted as saying as he visited Parisian shopkeepers, according to the AFP.

While the protests were originally motivated by the government’s planned increase to fuel tax, the Facebook-organized movement has morphed into a far wider one, with an unwieldy set of demands. As Quartz’s Annabelle Timsit pointed out, “the yellow vests are an amorphous group of people from all different political leanings in France, including socialists, communists, conservatives, far-right extremists, anarchists, and even centrists who identify as former Macron supporters.”

Macron is expected to address the nation today and announce crisis measures to quell the unrest.