Source AP ©

New French PM aims for 3 percent growth

French Prime Minister Francois Fillon said Wednesday that the government is targeting economic growth of 3 percent, but gave no timetable for the goal.

"Our target is to get another point of growth to rise to 3 percent, like all big developed countries," said Fillon, named last week after pro-market conservative Nicolas Sarkozy was inaugurated as president.

"For the time being we are sticking to a forecast of between 2.25 percent and 2.5 percent" for 2007, Fillon said, speaking on Europe-1 radio. "It's rather good compared to what our country did in the past, but it's less good compared to the average of big developed countries."

He confirmed that his government plans to propose reforms in July that would be "a real shock, to create this growth that we have lacked for so long."

Measures include exonerating overtime hours from taxes and payroll fees, and capping income tax at 50 percent.

French growth has averaged around 2 percent for the past two decades, while developing countries such as China and India have sped ahead, and that stagnation was a key theme of the presidential election campaign. French growth in 2006 was 2 percent - while worldwide growth was 5.2 percent.