France Releases 2015 Foreign Investment Statistics – And They are Good!
On March 22, 2016, the “2015 Annual Report: Foreign Investment in France – The International Development, in the French Economy” was released in Paris. The report was issued from Business France, the national agency monitoring international development in France as part of its larger role in supporting economic growth initiatives.
The many statistics and indicators included in the report were good news. Especially for those who closely monitor the French economy and see foreign investment as a good indicator for growth.
So, what are the highlights?
“Foreign companies currently generate 32% of French exports. Figures from the French National Institute for Statistics and Economic Studies (INSEE) show that more than one-quarter of foreign-owned company turnover in France was generated through exports in 2015, compared with 31% in the United States, 21% in Germany, 25% in the Netherlands, 15% in the United Kingdom, and 30% in Japan.”
“The leading source countries were the United States (18%), responsible for one-quarter of all inward R&D investments, Germany (15%), accounting for 26% of all foreign production and manufacturing projects, Italy (9%), providing 31% of inward investment in logistics, the United Kingdom (8%),responsible for 22% of all foreign investment in retail outlets, and Japan (6%), the fourth leading source of foreign production/manufacturing investment.”
“The number of R&D, engineering and design projects (87) remained high, amounting to 9% of all foreign investment decisions in 2015. Foreign-owned subsidiaries in France were responsible for 28% of all business enterprise R&D expenditure nationwide, spending €8.6 billion.”
Perhaps most welcomed by the French government was the increase in domestic employment:
“Foreign investment decisions generated 33,682 jobs in France in 2015, up 27% from 2014, amid fierce international competition to attract investment projects and the employment opportunities they entail… This is the best figure in the last five years. With an average of 19 decisions made every week, 2015 saw a 27% increase in jobs generated by foreign investment, up from 26,535 in 2014.”
This is all good news for the “France watchers” among international economists and finance markets.
Cause and effect?
Last year we commented on the World Banks’s report “Doing Business 2015-Going Beyond Efficiency” (see “France Moves To More Favorable Investment Policies” at http://www.primexis.eu/) which referred to an increase in investor confidence and pointed to specific policy initiatives. Importantly, one of these was reducing the time it takes to register a company at the one-stop shop (Centre de Formalités des Entreprises).
Others have credited the government’s “Pact of Responsibility” signed with the French Employers’ Association (MEDEF) as encouraging new investors. For some, like economist Christopher Dembik at Saxo Bank it doesn’t matter “with the Pact of Responsibility the government has scored an effective international advertising coup…the macro effect is not obvious, but it was very well received by foreign investors.” (see “Springtime in Paris” at http://www.primexis.eu/).
For Primexis, with our large portfolio of foreign clients and foreign investors, we welcome this news of new foreign investment interest in France. Staying abreast of changes in the French economy and environment, as well as welcoming new businesses to France is part of our core business.
