france: expect more · 4/13/2010 · keys to understanding the new france 8 a cost-effective...

France: Expect more

Keys to understanding the new France 2

INVEST IN FRANCE AGENCY

�Launched by the French government in 2001

�160 staff, HQ in Paris and 27 offices worldwide

�3 tasks:

- Project management: strong support for foreign investors all along the project’s life

- Communications: « France: expect more» (global or sectorial seminars, public-private

partnerships, testimonials, press trips)

- Benchmarks and proposals: suggestions to the French government to enhance France

attractiveness

�A network of regional partners throughout France


THE IFA INTERNATIONAL NETWORK IN 2010


THE IFA WORKS WITH REGIONAL DEVELOPMENT

AGENCIES THROUGHOUT FRANCE


WHY CHOOSE FRANCE?


THEY HAVE CHOSEN FRANCE AND BENEFIT FROM IT

� 22,600 foreign company sites in France

�Success stories of international companies in France: Royal Bank of

Scotland, GSK, Kingfisher, Tate&Lyle, HSBC, Easyjet, BT, BAE Systems,

Barclays, Hitachi, Canon, Tata Group-Corus Steel, Microsoft, Intel, Abott,

Pfizer

�The 3rd largest FDI recipient in the world, topping the list of European

countries, with US $65 billion of inflows (UNCTAD, 2010)

� 10 to 15 decisions taken every week by foreign companies to invest in

France

� Foreign companies in France account for:

�� over 40% of French exports (2009)

�� over 20% of R&D spending (OECD, 2009)

� 750 foreign company sites belong to one of France’s innovation clusters

� Approximately 1 in 7 French employees work for a foreign-owned

company


AN ATTRACTIVE LOCATION AT THE HEART OF EUROPE

Sources: Ernst & Young (June 2009), IFA 2008 Report (March 2009), DGTPE (2008), Banque de France (2009)

Excellent infrastructure

� European airport hub Paris Charles-de-Gaulle ranked 1st for cargo traffic in Europe

� The largest high-speed rail network in Europe (2,000 km or 1,250 miles of lines)

� The 3rd longest highway network in EU-27 countries (11,000 km or nearly 7,000 miles)

Sources: ACI, July 2009 - ERF 2009 / WEF 2009/2010


A COST-EFFECTIVE LOCATION IN EUROPE

� In 2008, electricity rates for manufacturers in France were very competitive€0.07/kWh-inc. VAT compared with €0.12/kWh in the UK and €0.13/kWh in

Germany (Eurostat July 2009)

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According to KPMG, business setup and operating costs* are lower in France than in Germany, Italy, the UK or the Netherlands

(Source : KPMG, Competitive Alternatives, 2008)


“FRANCE IS ON THE MOVE” (IMF): MOBILITY AND FLEXIBILITY IN THE LABOR MARKET

�3rd best hourly productivity in the world, after Norway and the USA (ILO: 2007, 2008, 2009)

� A more flexible labor market:

� Introduction of a mutual agreement procedure to terminate contractsbetween an employer and an employee (over 160,000 applications since 2008)

� Since 2008, employers and employees have had more freedom to negotiate working hours at company level

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French managers work longer hours than their European counterparts

Number of hours usually worked by week in 2008

Source: Eurostat, EFT Series, 2009


“FRANCE IS ON THE MOVE” (IMF): REFORMED TAX

REGIME TO BOOST AND SUPPORT INVESTMENT

�A competitive tax environment:�A favorable effective corporate tax rate (which takes into account different tax bases

in different countries), especially for:

* R&D operations: France ranked 2nd after the US, with a negative effective tax

rate of -25.7%, thanks to the research tax credit, compared with -13.8% for the

United Kingdom and 33.5% for Germany (which does not offer tax credits but

does grant subsidies)

* manufacturing operations: France ranked 4th after Mexico with an effective tax

rate of 30.2%, Canada and the US, compared with 30.9% for the United

Kingdom (5th) and 37.8% for Germany (8th)

�Abolition of local business tax on productive investments as of January 1, 2010

�‘Green’ taxation to reorient household and business consumption patterns towards clean

energies and technologies: over 40 measures, passed into law in 2008, to encourage

environmentally friendly behavior (notably tax breaks for companies when they contribute to

environmental protection and sustainable development)

�A favorable tax regime for expatriates: exemption from income tax on up to 50% of total

remuneration and possible exemption from paying social security retirement contributions

* Cost components:- Labor

- Facility costs

- Transport- Utility costs (electricity,

natural gas,

telecommunications)

- Corporate tax


“FRANCE MEANS INNOVATION”

� 71 innovation clusters stimulating public/private

research projects

� Research Tax Credit: France offers the most

attractive research and development tax credit in

Europe: 50% of R&D expenditure spending in the

first year, 40% in the second year and 30 % in subsequent year up to 100 millions

� OSEO: the innovation one-stop-shop, in

partnership with Invest in France Agency


INVESTING IN THE FUTURE

The Economic Stimulus Plan

1) Support for private investment (€11.5 billion):

In early 2009, the French government accelerated

the Treasury’s reimbursements of corporate tax claims (research and VAT tax credits)

Since January 1, 2010, the local business tax on productive investments

has been abolished (€12.3 billion in 2010, €6.3 billion per year thereafter)

2) Increased public investment (€10.5 billion):

A €4 billion increase in direct government investment in strategic areas (infrastructure,

higher education and research, and defense-related industries)

A €4 billion increase in investment in major companies in which the government holds

an ownership stake (EDF, GDFSuez, RATP, SNCF, La Poste) will help modernize

and develop rail and energy infrastructures and postal services

A €2.5 billion for investments made by local authorities


INVESTING IN THE FUTURE

� “National bond” to invest in the future: €35 billion to be invested in 5 strategic funding areas:

1. Higher education and training (€11 billion)2. Research (€8 billion): research facilities (€1 billion) and laboratories of excellence (€1 billion); research in the vital fields of biotechnology and nanotechnology (€850 million set aside to create university hospital institutes)3. Industrial policy and SMEs (€6.5 billion): €2 billion to preserve and boost the competitiveness of the aerospace, €1 billion for the automotive, rail and shipbuilding industries,€2.5 billion have been earmarked for SME development (start up etc.)4. Digital economy (€4.5 billion) A digital economy fund will equip France with a very-high- speed broadband network5. Sustainable development (€5 billion)

‘Green growth’: France’s “Green New Deal”, building on the success of the “Grenelle Environment Round Table Talks”, has opened the way for the development of ‘green’ buildings, renewable energies, ‘green’ technologies and sustainable transport

�� Renewable energy will meet 23% of France’s energy needs by 2020 (vs. 10% in 2009)�� A potential of €400 billion of public-private investment by 2020 (Source : Commissariat général au Développement durable, December 2008)�� Creation of nearly a dozen innovation clusters dedicated to ‘green’ technologies by 2010


HOW CAN WE HELP?


THE LONDON OFFICE AT YOUR SERVICE


HOW CAN WE HELP YOU?

We can help your project succeed in France by providing:

� Information and expertise:- We can help investors to identify the best investment opportunities

- We can offer expert advice on any issues concerning regulation in France:

taxation, employment law, residence permits, etc.

�A« tailor-made » support:

- A step-by-step approach for project management, all along the project’scycle- With our regional partners, we can help investors to find the best site for their

investment project

- We offer long-term support to investors, providing a one-stop-shop for

companies as they seek to contact different areas of government and local

authorities


CONTACT

Fabrice Etienvre,

CEO Invest in France UK and Ireland

[email protected]

Julien Ravalais Casanova

Director of Communications

[email protected]

WE HOPE TO SEE YOU SOON !

france: expect more · 4/13/2010 · keys to understanding the new france 8 a cost-effective...

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