Investors to France : We believe in You !

Investors to France : We believe in You !

EY’s « 2019 Barometer of Investor Attractivity gave France some very good news: it continues to be a prime attraction for foreign investors.

In fact , France overcame Germany to become number 2 ,and following the United Kingdom in terms of number of investment projects.

The report put it this way :

« Investors say that France can reinvent itself and take a new position in Europe, faced with the delays of its two major competitors. With its structural assets (skills, infrastructure, market diversity, creativity), which largely explain its power of attraction, it is ready to stand shoulder to shoulder with the American and Asian giants. »

This glowing assesment was followed by the caveat :

« It will do so all the more so if it resolutely pursues its transformation efforts, whether in the public sector or within its economic fabric, while ensuring their definitive acceptance by the social body. »

International investment leaders in a clear and encouraging way are calling on France to maintain the course of reforms, to extend the recent momentum of its image, to transform even more profoundly its competitiveness to strengthen its attractiveness.

A Steady Increase in Foreign Investment

  • In January 2018, 305 billion euros of new foreign investment was announced ;
  • In 2018, France counted 1,027 foreign company investment projects and outperformed Germany as the second most attractive country in Europe after the United Kingdom ;
  • Another reason for satisfaction is that France remains Europe’s leading destination for international investment in industry and increasingly in AI and technolgy.

France becoming Europe’s Centre for Innovation

France is becoming the leading European country for the establishment of research and development centres financed by foreign capital. As Primexis reported in an earlier article, 2018 saw :

  • A 2 billion eurosinvestment over 5 years by the German software company SAP, 750 million euros earmarked for research and development ;
  • Google, already operating one center for research on artificial intelligence, will open a second center and increase its workforce ;
  • Facebook investing an additional 10 millioneuros and plans to double its artificial intelligence research teams by 2022 ;
  • Novartis announced its acquistion of ETI AAA (nuclear medicine) for 300 billion euros and its investment of 900 million euros in research and building a new headquarters in France’s Haut-Rhin Region

In 2019, China is leading the list of investors, and continuing its agressive policy of foreign investment was its company Microport.  This big  Chinese. company specialises in health and medical equipment, in particular “pace makers” and defibrillators.  Microport intends to invest an additional 350 million euros in its research and development centre further augmenting to its already present operations in Clamart in the Hauts-de-Seine area

Other key investments announced for 2019 were :

  • The American agri-food group Mars announced investments of 120 million euros in eight of the sites it has in France. Of this amount, €70 million will be allocated to the Haguenau plant in Lorraine, which manufactures M & M’s
  • The consumer goods group Procter & Gamble will invest €50 million in a new production line for laundry and cleaning products in Amiens.
  • Another step forward for the Regions, but already announced this fall,Canada’s Transpod will invest €20 million to build a 3 km test line in Haute-Vienne for the Hyperloop high-speed train, the project of Elon Musk, the American entrepreneur who founded Tesla.
  • American network equipment manufacturer Cisco plans to invest €60 million in research and innovation, mainly in the Paris region
  • Microsoft and IBM will also increase their presence in France.

In an economic and political climate that was more tense in 2018 than in 2017, marked by uncertainties related to Brexit, the slowdown in European growth, trade tensions between the United States and China… and the disruption of France’s own social climate since November 2018, the barometer of France’s attractiveness remains very positive.

That is good news for us all.

 


Didier Hémion

Partner Accountant
International Business Services Department

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