France’s Attraction for Foreign Investors Withstands Covid Crisis
French economists had prepared for the worse while waiting to see 2020 foreign investment figures …but the most recent indicators and the story they are telling is not as dire as they predicted. In fact, as recently reported in Les Echos , France’s premier economic and finance newspaper, … «France is not doing so badly ».
In 2020, 1,215 new foreign investments were made in France, according to Business France.
« A figure down by 17% compared to 2019 but which reflects, according to Franck Riester, the Minister for Foreign Trade, “a resilience of French attractiveness” since “foreign investment fell by 19% in Europe and 33% worldwide last year. Not so bad in a context of “increased competition between European countries to attract foreign capital”, as Christophe Lecourtier, the CEO of Business France says. »
And importantly these investments also translate into employment, representing an addition of 30,000 jobs to an economy trying to refind its balance during this worldwide health crisis and the accompanying economic fallout.
« All these projects have supported 34,500 jobs, 30,000 of which have been created and maintained. While this number is 13% lower than in 2019, it is still 14% higher than in 2018. “2020 is thus the second best year in ten years,” the government is pleased to say. Several sectors are showing dynamism. For example, the health sector recorded a 40% increase in the number of foreign investment projects compared to 2019. Renewable energy projects also increased last year. »
Imagining a Post-Covid Future
And now, what will happen?
- Competition is likely to become increasingly fierce between countries ;
- All of which will seek to ensure that relocations of certain industrial activities land on their territory ;
- Brexit has not finished triggering capital movements and relocations as its effects are only now coming into effect
Is France ready for this competition ?
As we reported in an October 2019 article on our website the prognosis is good. In the 2019 Eighth International Global Competitiveness Report, a detailed analysis of global competitivity looking at the world’s 25 largest economies in a comprehensive manner :
« France has shown substantial, marked improvement across a whole range of global competitiveness and innovation indices over the past years. In 2019 France was ranked the 5th most attractive country for foreign direct investment in the world. »
And very importantly France has a positive global reputation:
« according to the US News & World Report magazine, it is now the 2nd country with the strongest cultural influence in the world ».
(read full article at : https://www.primexis.eu/global-competitiveness-report-france-good-news/)
The world economy is still in the throes of the COVID crisis with its debilatating economic consequences. However, with the arrival of vaccines and their distribution acrosss the globe people are already looking at post-COVID scenarios.
France’s 2020 foreign investment figures are good news. They are an early indication that France will be able to maintain its highly competitive position for foreign investors.