France narrowly avoided slipping into recession in the third quarter of 2008 with growth of 0.14 percent compared to the second quarter, Economy and Finance Minister Christine Lagarde said Friday.
"The figure is astonishing because everyone was expecting a negative figure and preparing for a recession, which is technically two consecutive quarters of negative growth," Lagarde said.
The French statistics institute INSEE, due to release official figures later Friday, earlier estimated that the economy would contract 0.1 percent in the three months to September after shrinking 0.3 percent in the second quarter.
"France, unlike Germany on minus 0.5 (percent) or Britain on minus 0.5 (percent) has a positive 0.14 percent," Lagarde said.
"This is good news and shows that France is not technically in recession," she said, adding that "government policies are beginning to have an impact."
Household consumption and business investment "are the two drivers which in the third quarter pushed France past Germany and Britain," the minister said.
Household consumption held up better than in the second quarter, she said, while business investment grew 0.3 percent after a fall of 1.0 percent in the three months to June.
External trade, the other major component of the economy, was neutral.
The French government expects overall growth of 1.0 percent this year but recently cut its 2009 forecast to a range of 0.2-0.5 percent.
The European Commission puts French growth at 0.9 percent this year and zero in 2009 while the International Monetary Fund expects a recession next year with a contraction of 0.5 percent.