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Benchmarking France’s performance

Posted by Invest in France Agency in France's image, Investment in France; June 22, 2011

In 2010, the Invest in France Agency (IFA) and its regional partners recorded and cross-checked 782 job-creating foreign investment decisions in France.

For the same year, Ernst & Young’s “European Investment Monitor” listed 30% fewer projects in France, while the “fDi Markets” database counted fewer than 300. The reasons behind these statistical disparities lie in methodological differences and sector classifications, as well as the inherent difficulty of compiling such surveys.

This being so, where exactly does France stand in Europe? The first half of 2011 has provided several interesting clues.

France’s image abroad

In January, a survey conducted by the IFA with foreign company directors and decision-makers confirmed two key points: the Agency’s 2010 “France. Expert More” promotional campaign in leading emerging economies has borne fruit, particularly in India and China, where France is now widely perceived as a country “on the move”, attractive to investment, innovative, and forward-looking.

However, this survey also showed that Germany and the United Kingdom also enjoy a strong business image in these countries, which is another good reason not to let up in the promotion of France’s investment attractiveness.

Projects and investment attractiveness

In March 2011, the “Strategic Attractiveness Council”, chaired by the President of France, coincided with the announcement of growth in job-creating foreign investment in France last year, after three years of sluggishness following the global economic crisis.

The number of projects rose by 22% in 2010. On average, 15 foreign investment decisions were made in France every week. The trend of foreign investment in R&D centers and European headquarters remained buoyant. We can therefore conclude that the decisive advantages of doing business in France are now widely recognized abroad.

European standings

Last month saw the publication of Ernst & Young’s “European Investment Monitor”, in which France remained the second largest recipient after the United Kingdom of job-creating foreign investment projects in 2010. France also remains the leading destination in Europe for foreign investment in industry, but in the overall standings, Germany is hard on France’s heels in the top three; as such, we should bear in mind that the intense competition between European rivals is unlikely to diminish.

We can look forward to the publication in July of the IFA’s “France Attractiveness Scoreboard 2011”, which will provide a chance to examine more closely France’s standing in Europe according to a complete range of investment attractiveness factors.

David Appia Chairman and CEO, The Invest in France Agency

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Good news: “Europe is back on track”

Posted by Invest in France Agency in Events, France's image, Innovation and R&D, Investment in France; June 15, 2011

The latest Ernst & Young European Attractiveness Survey concludes that “Europe is back on track” in light of the intentions of companies worldwide to invest and expand in Europe. The report was compiled using feedback from no fewer than 812 international business decision-makers.

The results of the survey, unveiled at the World Investment Conference (WIC) in La Baule, France, were well received as a positive signal by the global business and political leaders in attendance. The findings were reflected in the general positive feeling that pervaded the event about the future for investment in Europe.

There was also good news for France specifically as, along with the UK, it remained an FDI leader in Europe, while Western Europe remained the second most attractive investment region in the world in the eyes of respondents, surpassed only by China.

Attending the conference was David Appia, Chairman and CEO of the Invest in France Agency. He drew attention to the agency’s own annual report, which also confirmed France’s improving position in the inward investment market. He commented that “France remains the leading recipient in Europe of industrial projects. For us, 2010 was a very good year. According to our own figures and the perceptions of the Ernst & Young survey, we expect to maintain our growth.”

Bronwyn Curtis, Head of Global Research for HSBC, was an inspiring delegate at the conference and, when interviewed, pointed out that “France does quite well if you look at the World Bank’s Ease of Doing Business Index.” When asked if she felt France is reacting fast enough to the market, Curtis said that “France is moving quickly, they see that they must take the opportunities now.”

Another delegate and business leader who is very enthusiastic about France as a business destination is Cees de Wijs, Senior Vice President of International Operations at ACS. ACS, a Xerox company, runs major cutting-edge urban transport projects in France and around the world. Mr. de Wijs commented that “The future of investment in France is very positive for Xerox. We invest a lot in product development and the know-how of our people and we are confident that we will continue to do so in France.”

Further insight into France’s position in the market was provided by Marc Lhermitte, a partner at Ernst & Young. He observed that “France’s challenge is to make sure that it retains its existing investors and works hard to help them grow.” One other area of progress he noted is that France is now doing well in attracting manufacturing projects.

From a wider perspective, Mr. Appia recognized the importance of the European economy to France’s position. “Companies that come from foreign countries and invest in France do so of course because of the size of the French market, but they also use France as a springboard into Europe. Having a strong, vibrant, dynamic European economy contributes to France’s investment attractiveness.”

France’s strong showing in the Ernst & Young survey, backed up by the views of numerous business leaders at the World Investment Conference, highlights the country’s political commitment to uphold and enhance policies that increase France’s attractiveness to foreign investors.

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Recommendations for European competitiveness – How is France doing?

Posted by Invest in France Agency in Events, France's image, Innovation and R&D, Investment in France; June 15, 2011

The recent World Investment Conference (WIC) in La Baule, France hosted a series of workshops with panels composed of global business chiefs, academics, investors and political leaders, resulting in a series of recommendations for European governments.

This collaborative approach sought solutions to ensure that European countries remain competitive and continue to be highly attractive to investors. There was a general consensus that recommendations should not only be made in response to the current economic and social climate, but also be born out of foresight and predictions of conditions in the future.

The suggestions, which sometimes amounted to impassioned pleas, included a request to create a business environment that would be more conducive to apprenticeships in France. Calls to streamline bureaucracy for small businesses in France have already been answered, so it is hoped that this latest request will also be recognized and responded to quickly. As conference attendee Clara Gaymard, City Initiative Global Leader & President & CEO of General Electric (GE) France, pointed out “10 years ago, France was not seen as an enterprising country, but the fact is that today France has the most start-ups in Europe because the business environment has provided the opportunities for these companies to be created.”

Other recommendations for Europe included centralizing bureaucracy for SMEs and changing the culture of public-private partnerships to improve mutual trust. This would consequently help France for example to compete better with China in the speed of getting such projects underway – it takes around two months in China, compared with at least 18 in France, as Marc Duval-Destin, VP Automotive Research and Advanced Engineering for PSA Peugeot Citroën pointed out at the conference.

Another recommendation made was to centralize the promotion of innovation clusters in Europe and their attractiveness to foreign investors. Prof. Delphine Manceau of the Institute of Innovation and Competitiveness said “Competitiveness in European countries is based on innovation in a world where it is difficult to compete on cost and price, so the way to stimulate employment and build competitiveness today is to innovate. France has really benefited from its strong innovation clusters policy”. It is also hoped that Europe as a whole can mimic France in benefiting from cluster promotion. As David Appia, Chairman and CEO of the Invest in France Agency asserted “Promotion on a national and European level is equally important.”

One overriding question that came out of the WIC workshops was why Europe as a whole shouldn’t have a research tax credit and the funding for innovation that France already enjoys. The general consensus was that these are major factors in attracting big business to invest in the country, making France a global model in encouraging investment. Regarding GE’s investment program, Ms. Gaymard pointed out “The tax environment in France is much better than it was before and of course this has had a direct impact on GE’s strategy.”

GE is investing €45 million in signaling and public transport in France, as well as in research, healthcare and hundreds of new staff for their engineering center. “We believe in France, we invest in France, we believe in research and development in France”, added Ms. Gaymard.

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