France is Europe’s leading host country for FDI in industrial and R&D projects

The latest EY barometer on the attractiveness of France confirms its position of leading European host country for FDI in industrial and R&D projects. Despite a tense economic and geopolitical climate, the French economy is keeping up and the government is determined to move forward and maintain its pro-business reforms agenda.

France attractiveness is up at heights records

1,323 new investment decisions were taken in France in 2018, which is a record height in the last decade. With 339 projects in the manufacturing sector, France remains the leader in Europe. The strong increase of FDI in R&D projects, up to 85% with 144 projects, also places France at the top of European destinations for investment in innovation.

A pro-business reform agenda to boost the French business environment

An ambitious reform program has been put in place by the government to foster business initiatives and make France a more competitive and more attractive country. Here are the main measures to remember:

• Unlock business investment thanks to the reduction in corporate tax (25% by 2022), lower social contributions, a 40% depreciation allowance of investments in robotics and digital solutions for SMEs, in 2019 and 2020, and lower taxes on capital with the introduction of a flat tax (30%).
• A more flexible and predictable labor market to boost employment.
• Skill investment program: €15 billion aimed at job seekers and young people; two million people will be trained until 2022.
• Administrative simplification for businesses and industrial sites.
• The ‘Productive Pact’ will be presented in the first quarter of 2020 and implemented from autumn onwards. It aims to help reach full employment by 2025, improving industrial competitiveness and boosting job creation.

France long-term priorities and main assets

In the long run, France aims at developing new skills, supporting the growth of its SMEs and strengthening its competitiveness and ability to innovate. In addition to tax credits for innovation and R&D, France’s main assets are its diversity of sectors activity, its infrastructure and its pool of highly qualified talents.

There are also several sectors where France and the Nordic countries would benefit from strengthening their cooperation, such as in the health, artificial intelligence or mobility sectors for instance.