France is set to introduce a $33 billion stimulus package designed to help steer the European nation out of the recession that is hitting nearly every country across the globe. The stimulus package, announced yesterday in front of a Renault factory in Douai, France, by president Nicolas Sarkozy, includes about 1.2 billion euros in aid for the auto industry in addition to incentives aimed at encouraging French people to buy new cars.
The package provides about 1.2 billion euros to PSA Peugeot Citroën and Renault. It was announced in front of the Renault factory that builds the compact Megane, among other Renaults.
The French government will give up to 1,000 euros to those who scrapped old vehicles in exchange for new, environmentally friendly cars. Similar plans have been offered in other nations and even within the United States – a nearly identical program began in Texas over a year ago.
The stimulus package pushes France’s defecit to 3.9 percent of its GDP in 2009, well above the 3 percent limit imposed by the European Union. However, the EU has relaxed its standards for 2009 to help governments cope through the economic downturn. Sarkozy said he intends to restore France’s finances within a few years.
