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FDI in France
Overview by Globlatrade.net: FDI in Figures
France ranks third in the world in attracting Foreign Direct Investments. Paris is the second city in the world, after Tokyo, in terms of establishment of multinational headquarters. It has about 500. Nevertheless, the country showed a decline in foreign investment due to the deterioration of the international economic situation; this should however improve with the economic recovery.
The country's strengths include: its position as a fifth world's largest power, its highly skilled workforce, industrial base and agricultural resources and its geographic location in the center of Europe.
| Foreign Direct Investment | 2007 | 2008 | 2009 |
| FDI Inward Flow (million USD) | 96,221 | 62,257 | 59,628 |
| FDI Stock (million USD) | 1,260,244 | 920,842 | 1,132,961 |
| Performance Index*, Ranking on 141 Economies | 88 | 100 | 71 |
| Potential Index**, Ranking on 141 Economies | 19 | 18 | - |
| Number of Greenfield Investments*** | 569 | 680 | 408 |
| FDI Inwards (in % of GFCF****) | 17.3 | 10.0 | 22.8 |
| FDI Stock (in % of GDP) | 48.6 | 32.3 | 42.8 |
Source: UNCTAD
Note: * The UNCTAD Inward FDI Performance Index is Based on a Ratio of the Country's Share in Global FDI Inflows and its Share in Global GDP. ** The UNCTAD Inward FDI Potential Index is Based on 12 Economic and Structural Variables Such as GDP, Foreign Trade, FDI, Infrastructures, Energy Use, R&D, Education, Country Risk. *** Green Field Investments Are a Form of Foreign Direct Investment Where a Parent Company Starts a New Venture in a Foreign Country By Constructing New Operational Facilities From the Ground Up. **** Gross Fixed Capital Formation (GFCF) Measures the Value of Additions to Fixed Assets Purchased By Business, Government and Households Less Disposals of Fixed Assets Sold Off or Scrapped.
FDI Inflows By Countries and Industry
| Main Investing Countries | 2009, in % |
| Netherlands | 15.9 |
| UK | 14.1 |
| Luxembourg | 12.2 |
| Belgium | 11.2 |
| USA | 10.3 |
| Germany | 10.0 |
| Switzerland | 5.9 |
| Spain | 3.5 |
| Main Invested Sectors | 2009, in % |
| Manufacturing | 28.3 |
| Finance and insurance activities | 23.5 |
| Real estate activities | 13.6 |
| Trade, car and motorcycle repair services | 8.6 |
| Administrative and support services | 7.5 |
| Information and communication services | 5.0 |
| Specialized activities, research and technology | 4.0 |
Source: Bank of France
- Form of Company Preferred By Foreign Investors
- SA: public limited company
- Form of Establishment Preferred By Foreign Investors
- The subsidiary
- Main Foreign Companies
- Consult some examples of investment projects in France.
- Sources of Statistics
- The Ministry of Industry
The French Agency for international investments
Why You Should Choose to Invest in France
- Strong Points
- France is one of the world's ten economic powers. It has quality infrastructures. The work force is qualified and productive (second in Europe in terms of hourly productivity). France is an innovative country with an highly developed tertiary fabric.
- Weak Points
- The drawbacks of the French market are: one of the highest taxation rates in the world, significant manpower costs, low competitiveness in some sectors which can hinder the economies of scale. Research suffers from insufficient collaboration between the public and private sectors.
- Government Measures to Motivate or Restrict FDI
- Foreign companies enjoy the same government aid as French companies (aid for productive investment, R&D, professional training, job creation, etc.). The number of administrative formalities for foreign companies to settle in France has been reduced.
To fight against the financial crisis, the French government has implemented different mesures: the economic relaunch plan has committed the financing of 1,000 projects. These investments bear on transport infrastructures, higher education and research, State real estate property, housing and urban redevelopment and also health. Additionally, Sarkozy's government has abolished the professional tax in order to permanantly stimulate investment. Furthermore, the government established a strategic investment fund of EUR 20 billion, in Autumn 2008. Its aim: to buy stakes in industrial companies whose development is essential to the French economy.
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This article covers topics such as Openness to Foreign Investment, Conversion and Transfer Policies, Expropriation and Compensation, Dispute Settlement, Performance Requirements and Incentitiives, etc in France,
U.S. Commercial Service France on 4 Jan 2010 related to FDI in France
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