France to exit recession by year-end -INSEE

* French economy to exit recession this year

* Unemployment to rise to highest level since end-1999

* Companies to speed up job cuts

By Anna Willard

PARIS, June 19 (Reuters) - The French economy will crawl out of recession in the final quarter of this year but companies are set to speed up the pace of job cuts, national statistics office INSEE said on Friday.

The euro zone's second largest economy probably shrank 0.6 percent between April and June and will contract 0.2 percent in the third quarter before posting zero growth at the end of the year, it forecast in a quarterly report.

"Our scenario is based on a stabilisation in the last quarter of this year," Eric Dubois, head of the economics department said at a news conference.

"France will have finished with the recession at the end of 2009 but this is not guaranteed."