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Reforming France

PARIS – Before this year has ended, the French parliament will have enacted a comprehensive pension overhaul, which is essential not only to putting France’s public finances on a sound and sustainable footing, but also to shoring up confidence in the eurozone in 2014 and beyond. Moreover, how the reform was carried out is as important as the measure itself.

France has more favorable demographics than most other European countries. Nonetheless, further effort was needed to strengthen the pay-as-you-go pension system by the equivalent of one percentage point of GDP. The contribution period will therefore be increased gradually, reaching 43 years in 2035.