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French minister backpedals on financial toll of ongoing protests

The ongoing strikes in France haven't affected its 2010 growth forecast, says the country's economics minister, contradicting comments a day earlier when she said the protests were threatening France's recovery.

Striking workers block the main entrance of the an oil depot, protected by riot police officers, at Fos sur Mer

Strikers in France continued to block the entrance to oil depots

The French government backtracked on Tuesday on comments made a day earlier that ongoing strikes in the country were threatening France's recovery from the financial crisis.

Contradicting an earlier statement, Economics Minister Christine Lagarde said the protests over a controversial pension reform have not affected government growth forecasts for this year.

"I don’t deny we've had several days where there has definitely been an economic impact, but I don’t think it’s enough to change our growth forecast for the full year," Lagarde told France’s Radio Classique. The French government said it expects gross domestic product to expand 1.5 percent in 2010.

Still, new strike plans continue across France unabated. On Tuesday, students across France plan to hold a day of protests at their universities, while labor leaders have called for a ninth one-day stoppage for Thursday.

France being hurt

Christine Lagarde

Lagarde backflipped on earlier comments about the French economy

Only a day earlier, Lagarde had warned that the strikes, which are costing the French economy 200-400 million euros ($280-560 million) a day, were threatening France's prosperity.

The government estimates that the strikes have cost the country around three billion euros since they began on October 12.

"We shouldn't be weighing down this recovery with campaigns that are painful for the French economy and very painful for a certain number of small- and medium-sized businesses," Lagarde had said Monday.

She had also argued that the global publicity of violent protests had cost France dearly in its ability to draw international investors.

"It's the attractiveness of our territory that's at stake when we see pictures like that," she lamented, adding that strikes at refineries and fuel depots were also taking a toll.

Strikes ongoing

Protestors take to the streets during a demonstration in Paris

Protests have swept France for nearly two weeks

President Nicolas Sarkozy's fiercely-contested bill to raise the age of early retirement from 60 to 62 could pass into law as soon as Wednesday, after approval came from the Senate on Friday and the versions passed by the lower and upper houses of parliament were reconciled on Monday.

Yet trade unions have called another strike for Thursday, and ongoing protests around the country have triggered fuel shortages.

In a tactical victory for Sarkozy, workers at three of 12 refineries on strike have since voted to return to work. Police were able to clear protesters blocking all 219 fuel depots not attached to the nine refining sites still on strike.

The Union of Independent Petrol Importers (UIP), however, said fuel supplies were still low, with one in three French filling stations undersupplied.

In a possible sign of the strikes easing further, the FO union said it would recommend that its members end a garbage collection strike in Marseille, where 10,000 metric tons (11,000 short tons) of refuse remains uncollected.

"The movement is not over but we're taking into account a particular cleanliness situation," said the FO's Elie-Claude Argy, who cited "security and sanitary" reasons for the decision.

Author: David Levitz, Darren Mara (AFP, dpa)

Editor: Chuck Penfold

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