October MYTHS ABOUT FRANCE

Transcription

1 October MYTHS ABOUT FRANCE

2 Myth N 1:«Once a world power, France is now on the decline.» Reality: World s 6 th largest economic power at the heart of a 493 million strong consumer market in rd destination for FDI after the UK and the USA in 2006 World s 5 th largest exporter of services World s 5 th largest exporter of goods 2

3 Myth N 2:«France is an old country.» Reality: Sustained demographic growth France United Kingdom Sweden Netherlands Spain Poland Italy Germany Crude birthrate / 1,000 in 2006 Source : Eurostat

4 Myth N 3: «The French are always on strike.» Reality: Low number of working days lost in the private sector due to strikes Spain Italy United- States France Netherlands Germany Japan Average working days lost due to strikes per year per 1,000 inhabitants ( ) Data source: ILO Yearbook of Labor Statistics IMD

5 Myth N 4: «The French are lazy.» Reality: A highly productive labor force Norway United-States France Ireland Belgium Netherlands Sweden Denmark United-Kingdom Germany Labor productivity per hour worked (in 2006) Source : ILO

6 Myth N 5: «France is not business friendly.» Reality: Lower costs for senior managers ,014 76, ,093 55, ,381 78,788 Wages Non wage labor costs , , ,593 0 France Germany UK Data : Cross-country comparison of employment costs (in thousands $) Source : European survey of employment costs, Mercer April

7 Myth N 5: «France is not business friendly.» Reality: The cost of living in Paris is less than in most major cities 140 London Tokyo Paris New-York Moscow London Seoul Tokyo Hong Kong Copenhagen Geneva Osaka Zurich Oslo Milan St Petersburg Paris Singapore New-York Dublin Tel Aviv Rome Vienna Beijing Cost of living (real-estate included) [New York City = Index 100] Source : Mercer Human Resource Consulting

8 Myth N 6: «France is deeply conservative and incapable of reform.» Reality: Increased flexibility in the labor market More flexibility in the 35 hour working week: - Statutory limit increased by 220 hours (up to 1827 hrs/yr) - Voluntary overtime beyond the statutory limit - Annual statutory limit for executives and commercial agents New: - Reduced social charges for employers, and income tax and social security charge exemptions on overtime hours for employees 8

9 Myth N 7: «French taxes are stifling.» A more competitive fiscal system : Reality: - Maximum income tax rate reduced to 40%, like in the UK - Capital gains from sales of shares are totally exempt from tax once the securities have been held for eight years New : - Overall tax rates will drop from 60% to 50%, including direct, national and local taxes, as well as CSG and CRDS contributions, starting in January 2008 for taxes paid in Applicable households will also be able to take advantage of an increase from 20% to 30% on the tax deductions related to the value of their principal residence, as well as deduct 75% from their wealth tax (ISF) to invest in smalland-medium-sized enterprises up to a set limit of 50,000 per year. 9

10 Myth N 7: «French taxes are stifling.» Reality: The best research tax credit in the European Union: 30% of yearly R&D expenses, up to a limit of 100 million. Beyond this maximum, it is 5%. 10

11 Myth N 8: «Investors are fleeing France!» Reality: 18,000 foreign subsidiaries based in France Foreign companies with presence in France employ some 2.3 million workers Source: The Economist Intelligence Unit

12 Myth N 8: «Investors are fleeing France!» Reality: Paris ranks 2 nd for the location of company headquarters in Tokyo Paris USA London Beijing Seoul Toronto Madrid Zurich Houston Munich Osaka Rome Atlanta Source: Fortune «Global 500 companies»

13 Myth N 9: «French economic patriotism is nothing but protectionism.» Reality: 47 Foreign investors hold 46.1% of the French listed companies in Source: Balance des Paiements - Banque de France 13

14 Myth N 10: «France is all about food, wine, berets and fashion.» Reality: 14 French companies among world s Top 200 World s Top 200 companies (based on turnover, earnings, and market value) Source: Forbes 2000,