France may have so far escaped the worst fallout from the financial crisis, but its economy is flirting with a recession that could derail President Nicolas Sarkozy’s reform programme.

The government is predicting 1 per cent growth this year and the same in 2009, which is slightly ahead of the 0.8 per cent consensus view of independent economists for next year. Only six months ago, ministers were forecasting growth of 2-2.5 per cent for 2008.