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flag France France: Economic and Political Outline

In this page: Economic Indicators | Foreign Trade in Figures | Sources of General Economic Information | Political Outline

 

Economic Indicators

The international financial crisis led France into a recession in 2009, the French economy contracted by 2.5%. Nonetheless, the country resisted this episode better than the average of the Euro-zone countries, thanks to a more diversified economy, a more solid banking system, as well as a massive stimulus plan. The GDP improved in 2010-2011, mostly driven by the resumption of international trade. However the Euro-zone sovereign debt crisis put an end to this brief upturn and growth dropped to zero in 2012.  Due to a rise in unemployment and a lack of entrepreneurial confidence, growth was only 0.2% in 2013. The growth rate for 2014 is estimated to reach 1%, based on the improvement of the regional context.

In 2013, the vagueness of political decisions was criticized, foreign investors were not confident. With a public debt approaching 90% of GDP and a high bank exposure to the struggling Euro-zone countries, France remains particularly vulnerable. In early 2012, the rating agency Standard and Poor's downgraded the country's sovereign debt. The government's priority is given to restoring public finances through a policy of fiscal restraint. However, during the summer of 2013, the government created again several new taxes. Among the key measures, the government had planned an exceptional solidarity contribution of 75% on the income bracket exceeding one million euros, which was rejected, and the creation of an income bracket taxed at 45%. In 2013, the CICE (Pact for Growth, Competitiveness and Employment) plan was announced with the purpose of improving the competitiveness of French companies. For 2014, the government has announced its plan to reduce public expenditure, expecting to save EUR 15 billion. Lastly, France must bring down its public deficit to 3.6% of GDP by the end of 2014, as stipulated by the regulations of the European Union. The retirement plan reform was considered too reticent by the labor management. France must also deal with a loss of competitiveness on its economy and its process of de-industrialization. Lastly, the influx of FDI into the country clearly decreased in 2013.

The rate of unemployment has been affected by the crisis, estimated at 11% in 2013, it has reached its highest level in 12 years but it should become stable in 2014. The municipal elections in March 2014 and the European elections in May 2014 could slowdown the rhythm of the reforms.

 
Main Indicators 20112012201320142015 (e)
GDP (billions USD) 2,865.302,688.212,807.31e2,902.332,935.36
GDP (Constant Prices, Annual % Change) 2.10.30.30.41.0
GDP per Capita (USD) 45,43042,4154445,384e45,691
General Government Balance (in % of GDP) -4.5-3.8-2.8-2.7-2.4
General Government Gross Debt (in % of GDP) 84.488.791.8e95.2e97.7
Inflation Rate (%) 2.32.21.00.70.9
Unemployment Rate (% of the Labor Force) 9.29.810.310.010.0
Current Account (billions USD) -49.00-57.11-36.86-41.33e-30.72
Current Account (in % of GDP) -1.7-2.1-1.3e-1.4e-1.0

Source: IMF - World Economic Outlook Database , Last Available Data

Note: (e) Estimated Data

Main Sectors of Industry

France is the largest agricultural power in the European Union, accounting for one-fourth of its total agricultural production, and the second agricultural power in the world after the United States. Nevertheless, the agricultural sector only represents a very small part of the country's GDP. The French agricultural activities receive significant subsidies, especially from the European Union. Wheat, corn, meats and wine are France's main agricultural products.

France's manufacturing industry is varied; however, the country is currently undergoing a de-industrialization process which translates into numerous relocations. The key industrial sectors in France are telecommunications, electronics, automobile, aerospace and weapons.

The tertiary sector represents nearly 80% of the French GDP and employs almost 75% of the active workforce. France is the leading-tourist destination in the world with more than 75 million foreign visitors every year.

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 2.9 21.7 74.9
Value Added (in % of GDP) 1.7 19.8 78.5
Value Added (Annual % Change) -1.4 -0.8 0.6

Source: World Bank - Last Available Data.

 
 
 
Monetary Indicators 20092010201120122013
Euro (EUR) - Average Annual Exchange Rate For 1 USD 0.720.760.720.780.76

Source: CIA - The world factbook - Last Available Data.

 
 

Learn more about Market Analyses about France on Globaltrade.net, the Directory for International Trade Service Providers.

Indicator of Economic Freedom

Definition:

The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labor freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

Score:
63.5/100
Position:
Moderately Free
World Rank:
70/178
Regional Rank:
33/43

Distribution of Economic freedom in the world
Source: 2014 Index of Economic freedom, Heritage Foundation

 

Business environment ranking

Definition:

The business rankings model measures the quality or attractiveness of the business environment in the 82 countries covered by The Economist Intelligence Unit’s Country Forecast reports. It examines ten separate criteria or categories, covering the political environment, the macroeconomic environment, market opportunities, policy towards free enterprise and competition, policy towards foreign investment, foreign trade and exchange controls, taxes, financing, the labour market and infrastructure.

Score:
7.38
World Rank:
24/82

Source: The Economist - Business Environment Rankings 2014-2018

 

Country Risk

See the country risk analysis provided by Coface.

 

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Foreign Trade in Figures

France is one of the 10 leading exporters in the world and trade represents more than 50% of the country's GDP.

However, the country registers a strong structural trade deficit. Imports are developing quickly, as the French population buys a lot of imported goods which are sold at less expensive prices on the local markets in comparison to products "Made in France". Energy imports and their net increase in prices also affect the balance of the accounts. In addition to this, despite the government's efforts to favor innovation, French exports have a relatively low added value. France's trade experienced a slowdown in 2013; exports decreased mainly in the automobile sector. In return, the agricultural exports, mainly cereals, increased while the energy imports decreased. Subsequently, the trade deficit was 9% lower than the results of 2012.

France's main trade partners are the European Union, the United States and China.

 
Foreign Trade Indicators 20092010201120122013
Imports of Goods (million USD) 560,081609,650720,029674,415680,673
Exports of Goods (million USD) 484,574523,460596,473568,920579,647
Imports of Services (million USD) 126,000167,223190,932173,988188,083
Exports of Services (million USD) 141,974195,308234,402215,507233,288
Imports of Goods and Services (Annual % Change) -9.48.96.3-1.31.7
Exports of Goods and Services (Annual % Change) -11.39.06.91.12.2
Imports of Goods and Services (in % of GDP) 25.527.930.430.129.8
Exports of Goods and Services (in % of GDP) 24.126.027.828.128.3
Trade Balance (million USD) -49,919-63,332-93,520-70,302-56,452
Trade Balance (Including Service) (million USD) -34,173-43,145-62,599-38,646-32,217
Foreign Trade (in % of GDP) 49.654.058.258.158.0

Source: WTO - World Trade Organization ; World Bank , Last Available Data

 

Main Partner Countries

Main Customers
(% of Exports)
2013
Germany 16.4%
Belgium 7.7%
Italy 7.1%
United Kingdom 6.9%
Spain 6.8%
See More Countries 55.1%
Main Suppliers
(% of Imports)
2013
Germany 17.1%
China 8.1%
Belgium 7.8%
Italy 7.1%
United States 6.5%
See More Countries 53.4%

Source: Comtrade, Last Available Data

 
 

Main Products

- bn USD of products exported in 2013
Powered aircraft e.g. helicopters and aeroplanes;...Powered aircraft e.g. helicopters and aeroplanes; spacecraft, incl. satellites, and suborbital and spacecraft launch vehicles 8.6%
Medicaments consisting of mixed or unmixed...Medicaments consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses incl. those in the form of transdermal administration or in forms or packings for retail sale (excl. goods of heading 3002, 3005 or 3006) 4.9%
Motor cars and other motor vehicles principally...Motor cars and other motor vehicles principally designed for the transport of persons, incl. station wagons and racing cars (excl. motor vehicles of heading 8702) 3.3%
Parts and accessories for tractors, motor vehicles...Parts and accessories for tractors, motor vehicles for the transport of ten or more persons, motor cars and other motor vehicles principally designed for the transport of persons, motor vehicles for the transport of goods and special purpose motor vehicles of heading 8701 to 8705, n.e.s. 3.0%
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals 2.5%
See More Products 77.6%
- bn USD of products imported in 2013
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals, crude 6.8%
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals 5.2%
Motor cars and other motor vehicles principally...Motor cars and other motor vehicles principally designed for the transport of persons, incl. station wagons and racing cars (excl. motor vehicles of heading 8702) 4.7%
Petroleum gas and other gaseous hydrocarbonsPetroleum gas and other gaseous hydrocarbons 3.7%
Medicaments consisting of mixed or unmixed...Medicaments consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses incl. those in the form of transdermal administration or in forms or packings for retail sale (excl. goods of heading 3002, 3005 or 3006) 2.7%
See More Products 76.8%

Source: Comtrade, Last Available Data

 
See More Products
More imports (Intracen Data)
More exports (Intracen Data)
 
 
 

Main Services

- bn USD of services exported in 2011
32.00%
24.25%
20.21%
7.00%
4.24%
2.91%
2.84%
2.37%
1.87%
1.84%
0.47%
- bn USD of services imported in 2011
29.73%
27.66%
23.09%
5.21%
3.38%
2.73%
2.38%
1.92%
1.92%
1.59%
0.39%

Source: Comtrade, Last Available Data

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Sources of General Economic Information

Ministries
Ministry of the Economy, Finance and Industry
Ministry of agriculture and fisheries
Ministry of small and medium enterprises, commerce, the craft industry and liberal professions
Statistical Office
French Institute of Statistics (INSEE)
Central Bank
The European Central Bank
The Bank of France
Stock Exchange
Euronext
Search Engines
Nomade
Voilà
Altavista
Aol.fr
Caloweb
C'est Trouvé
Excite.fr
La Boussole
Hotbot.fr
Lycos.fr
Bing
Netscape
Sharelook.fr
Economic Portals

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Political Outline

Executive Power
The President of the Republic is the Head of State. He is elected by direct universal suffrage for 5 years. He appoints the Prime Minister and his government at the suggestion of the Prime Minister. The Prime Minister sets the amount of the State's expenses and revenue, and prepares some bills.
Legislative Power
The parliament is composed of the Senate and the National Assembly. Senators are elected by indirect universal suffrage for 9 years renewable by a one-third majority vote every 3 years. The deputies (MPs) are elected by direct universal suffrage. They examine bills and private bills successively, vote laws and monitor the government.
Main Political Parties
The French Right is made up of the Union for a Popular Movement (UMP), the majority party, the Democrat Party and the Democratic Movement (MoDem) situated more to the Center and the National Front (FN) (in French)which is on the extreme right.
The Left brings together the Socialist Party (PS), the Greens (Ecologists), the French Communist Party (PCF) and various extreme left parties.
Current Political Leaders
President: François Hollande (since May 2012) - PS
Prime Minister: Manuel Valls (since 2 April 2014) - PS
Next Election Dates
Presidential elections: 2017
Parliamentary elections: June 2017
 

Indicator of Freedom of the Press

Definition:

The world rankings, published annually, measures the violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire sent to partner organizations,150 RWB correspondents, journalists, researchers, jurists and activists of human rights, including the main criteria - 44 in total - to assess the situation of press freedom in a given country. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).

World Rank:
39/180
Evolution:
2 places down compared to 2013

Source: Worldwide Press Freedom Index 2014, Reporters Without Borders

 

Indicator of Political Freedom

Definition:

The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.

Ranking:
Free
Political Freedom:
1/7

Map of freedom 2014
Source: Freedom House

 

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Last Updates: February 2015