France is the world’s 6th largest economy and the second leading trading nation in western Europe. It is the world’s 4th largest exporter of services and the fifth largest exporter of goods. In addition to this it is the world’s leading tourist destination which is visited by 75 million tourists per year.  

Economy
In 2007, the budget deficit was brought within limit for the first time and unemployment was reduced. GDP growth was steady at 2.1 per cent. France has struggled to counter the global economic downturn and growth slowed to 0.7 per cent. Real GDP is forecast to contrast sharply as consumer spending stagnates and investment and external demand decline sharply. Assuming more stable conditions in financial markets, a gradual recovery is expected to begin in 2011.  

Investment Climate
Since being elected in mid 2007, President Sarkozy has worked on a number of reforms aimed at addressing both short and long term restructuring. This includes reducing government spending, flexibility in the implementation of the 35 hour week, more labour market flexibility, less taxation and further privatisation and liberalisation of the business sector.  

Continued privatisation is considered demonstrative of the government’s commitment to promoting investment. France is already one of the top destinations for foreign investment, with some 670 foreign investment projects launched every year. More than 20,000 international companies have chosen the country as a business destination. Located at the heart of Europe and with one of the highest performing transportation infrastructures in the world France provides the ideal gateway to the EU, a market of almost 500 million customers.  

Construction
The French building and construction industry has been growing rapidly since 2002. This growth can largely be explained by an increased demand for new buildings – new housing in particular. The high number of orders in the building sector helped to maintain a high level of activity in the sector in 2007 and is expected to continue to do so in 2008. However interest rates and the general economic background is expected to slow down the sector’s dynamism in the long-term.  

Opportunities
France’s strategic location at the heart of Western Europe is served by a highly developed transport and communication network. The Eurostar high-speed train has reinforced the already strong air and sea connections between the two countries. The centres of London and Paris are only two hours fifteen minutes apart.  

France is home to world’s leading companies in many innovative industries and is the third largest recipient of foreign direct investment. The French economy benefits from a highly productive labour force. Structural reforms are being undertaken to help secure investment and this should offer new opportunities for UK companies in procurement and sub-supply. Numerous "pôles d’excellence" (industrial clusters) testify to the attractiveness of France as a business location. Key sectors where there are opportunities for both UK exports and investments are:

 • Biotechnology
• Pharmaceuticals and healthcare
• Software and ICT
• Creative/media/design
• Environment
• Aerospace
• Automotive industry
• Railways
• Chemicals
• Food and drink
• Distance selling  

There are also niche markets in all other sectors, especially for small and mediumsized businesses. Almost anything that sells well in the UK can be sold in France, provided that the quality and price are right.  

UK Trading Relationship
France and the UK are major economic and trade partners. Exports to France amounted to some £18.7 billion in 2008. Over the same period, the UK took goods worth £23.1 billion from France.  

The UK and France are also major investors in each other’s countries. France is the UK’s second largest European direct investor in terms of stocks and the UK is the largest investor in France. Mergers and acquisitions have considerably increased, leading to a growing interpenetration of both economies.  

KEY FACTS
Official Name: French Republic
Capital: Paris
Area: 543,965 sq km
Population: 61.9m (UN, 2008)
Major language: French
GDP (current): US$2,589.84bn (World Bank, 2007)
GDP growth: 2.2% (World Bank, 2007)
GNI per capita: US$38,810 (World Bank, 2007)
Inflation (consumer prices): 1% (2008 est.)
Labour force: 28.5m (2008 est.)
Unemployment: 7.4% (2008 est.)
Monetary unit: 1 euro = 100 cents
Exports to UK: £23,081.24m (HMRC 2008)
Imports from UK: £18,599.67m (HMRC 2008)

Main Industries
Machinery, chemicals, automobiles, metallurgy, aircraft, electronics, textiles, food processing, tourism.

Main Exports
Machinery and transportation equipment, aircraft, plastics, chemicals, pharmaceutical products, iron and steel, beverages.

Main Imports
Machinery and equipment, vehicles, crude oil, aircraft, plastics, chemicals.

CONTACTS

UK Trade & Investment
Kingsgate House
66-74 Victoria Street
London SW1E 6SW
Tel: 020 7215 8000
Email:commercialenquiries.paris@fco.gov.uk
Web: www.uktradeinvest.gov.uk

British Embassy
35 rue du Faubourg St Honoré
BP111-08, 75383 Paris Cedex 08
Tel: 00 33 1 44 51 31 00
Email: public.paris@fco.gov.uk
Web: ukinfrance.fco.gov.uk/en

French Embassy
Economic & Commercial Section
21/24 Grosvenor Place
London SW1X 7HU
Tel: 020 7235 7080