The arrival of spring in Paris is always a celebration. Songs have been written about it.
However over the last years, even though springtime brought better weather the economic numbers consistently remained dismal.
So, it was a surprise when this year the March 16 edition of Les Echos heralded some very good and long awaited news.
After three years of decline, foreign investment figures in France rose by 8% in 2014.
France’s governmental agency responsible for improving, attracting and monitoring foreign investment, Business France, released their annual report on March 16.
It detailed that rise in investment: foreigners invested in 740 projects which translates into maintaining and/or creating 25,000 employment opportunities.
The French government quickly credited this good news to its “Pact of Responsibility”signed with Medef, France’s national employer association, in 2013.
With it, business leaders were promised “less charges on labor”, and “less constraints on their activities” and 41 billion euros of lower charges and taxes for businesses by 2017.
CICE, the government’s competitive and employment corporate tax credit took effect in 2014, and 2015 will see the phasing out a total turnover tax known as “C3S” and a reduction on charges for salaries below minimum wage and on independents.
On April 5, French Minister of Work, François Rebsamen,convened first meeting with employers, unions, and the government to open discussions on France’s work codes.
All these events are being closely watched.
Will this greater effort by the government to become more business and investor friendly continue? 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.”
For Primexis, with our large portfolio of foreign clients and foreign investors, we are following these events to best help them benefit from these changes and be well situated to adapt to those in the pipeline.