This site presents two analyses of the French government's economic policies compared to a list of 35 economic policies as prepared by students Shannon Fracchia and David Rouxel with the Mike P. McKeever Institute of Economic Policy Analysis (MIEPA). This study was written in December of 2019. To read the analyses scroll through this site. To learn more about the background policies, click here
To learn more about MIEPA, click here
Return to MIEPA's Home PageThe study by Specialist Shannon Fracchia is presented immediately below. David Rouxel' study is presented immediately afterwords.
FRANCE - SHANNON FRACCHIA
This study presents a detailed study of the economic policies of China, as written by Specialist Shannon Fracchia. The ratings herein are based on the following rating scale:
5.0 Perfect Facilitation of Wealth Creation
4.0 Midway between Perfect and Neutral
3.0 Neutral Effect on Wealth Creation
2.0 Midway between Neutral and Obstructionist
1.0 Perfectly Obstructionist to Wealth Creation
[Rating scale copyright Mike P. McKeever, 2019. Used herein with permission]
RATING SUMMARY - SHANNON FRACCHIA POLICY NUMBER RAW SCORE ADJUSTED SCORE POSSIBLE PERCENTAGE 1 4.8 14.4 15.0 96 % 2 5.0 15.0 15.0 100 3 5.0 15.0 15.0 100 4 5.0 15.0 15.0 100 5 4.5 13.5 15.0 90 6 4.5 13.5 15.0 90 7 4.5 13.5 15.0 90 8 5.0 15.0 15.0 100 9 2.0 6.0 15.0 40 10 4.0 12.0 15.0 80 11 4.8 14.4 15.0 96 12 4.5 9.0 10.0 90 13 4.0 8.0 10.0 80 14 4.5 9.0 10.0 90 15 4.0 8.0 10.0 80 16 2.0 4.0 10.0 40 17 2.5 5.0 10.0 50 18 3.5 7.0 10.0 70 19 4.0 8.0 10.0 80 20 3.0 6.0 10.0 60 21 3.5 7.0 10.0 70 22 2.0 4.0 10.0 40 23 1.0 2.0 10.0 20 24 1.0 2.0 10.0 20 25 4.0 8.0 10.0 80 26 4.0 8.0 10.0 80 27 4.0 8.0 10.0 80 28 4.9 9.8 10.0 98 29 4.0 4.0 5.0 80 30 2.0 2.0 5.0 40 31 3.0 3.0 5.0 60 32 4.0 4.0 5.0 80 33 2.0 2.0 5.0 40 34 4.0 4.0 5.0 80 35 2.0 2.0 5.0 40 TOTAL 126.5 281.1 370.0 76.0% ===== ====== ===== =====
FRANCE - INDIVIDUAL POLICIES - SHANNON FRACCHIA
1 - Freedom from internal control 4.8
Schengen area, created in 1985, is an agreement between 26 countries in the Europeans union which permit free mobility within borders. There is no limit for French citizen to create a business within Schengen area. For example: it is possible for a French citizen to have a business in Switzerland and live in France without being control every time at the border.
2 - Freedom of speech 5.0
Freedom of speech in France is one of the strongest pillars. The most important freedom in France is freedom of press. Freedom of press is “protected by the 1789 Declaration of Human and Civic Rights” which assure the Freedom of Expression to every citizen. It is also protected by the European Convention on Human Rights. The declaration mentions that “everyone has the right to freedom of expression,” and has “freedom to hold opinions and to receive and impart information and ideas without interference of public authority, regardless of frontiers.” For instance, French people are manifesting against the new reforms about the retirement.
3 - Effective, fair police force 5.0
“Police Nationale” and “Gendarmerie” are the two main police force in France (excluded the army). They are armed but, according to the law “LOI n° 2017-258 du 28 février 2017 relative à la sécurité publique”, they can only use their guns on extreme cases. Depending on the case, the police force can be judged if they break the law. Moreover, businesses think that private security is efficient and more trustable than public police force.
According to USP, 62% of French population confess that they trust private security.
4 - Private property 5.0
In 1974, a law was created for intellectual and industrial property to have the right of respect to his/her property. It also mentioned that nobody can be prohibited from his/her property except for public context. Moreover, violation of private property is punished by French laws. After making a report of the violation, insurance will cover it with compensation.
5 - Commercial banks 4.5
In France, there are different good commercial banks such as Credit Mutuel, LCL etc., which “offer all classic financing instruments, including short, medium, and long-term loans, short-and medium-term credit facilities, and secured and non-secured overdrafts.” (France - Banking System) Moreover, to get a good interest rate, people need to show another offer that they cant get in another bank. However, French banks used to request to transfer their main account into the bank where the loan is, but the law "loi n° 2019-486 du 22 mai 2019 relative à la croissance et à la transformation des entreprises (relative to the increase and transformation of enterprises)“ takes off bank’s rights for mandating yours revenue in their bank.
6 - Communication system 4.5
2.7% of French population work in communication, and 46.2 billion of euros are invested in it, corresponding to 2.1% of GDP. France has diverse types of communication such as phone, TV, newspaper, and internet, the last one, very dominant.
Example of companies for the communication industries cited above are:
Orange S.A (France Telecom) is the biggest communication plan in France.
TF1, a French channel, is the most watched channel for the news in France. 6.53 millions average of french watch TF1 which is 26.4% of French population. According to TF1, “24% makes it the most popular domestic network.”
“Le Monde” is the most read new paper in France. It is a daily afternoon news paper with 2.8 millions of readers, in 2016.
Internet is the most common network used in businesses.
7 - Transportation 4.5
France transportations are very diversify. There are RER, bus, tram, subway, train depend of the city. Small cities are less likely to have good public transportations so they usually require a car to move around. It is easy to move around France using train, SNCF which is a public company, for a reasonable price, and each region has their own discounts and memberships. For example, in PACA region, “Zou Card” for students is only 13e per year and student get 50 to 75% off on your trip. You can also travel with “car13,” bus services between cities, all day with 2e. France transportation system is very good but unfortunately, public transportations, especially SNCF, have very bad services because, most of the time, they are on strike, late, or delete their trains.
8 - Education 5.0
As the US, France has private and public schools, from kindergarten to university. However, there is a big difference because in France public school are financed by the government. Therefore, in 2018, 6.7% of GDP is spent for education system which represent 157 billions of euros.
Public school is completely free until second year of university with can go from 190e to 620e maximum. Unfortunately, the quality of public school is not as good as private school. According to DEPP, in 2015, 43% of low class go in public school against 20% in private school. Private schools are mostly catholic with higher quality of education. Moreover, it is very easy to get help from the government for studying. There is also a possibility to study aboard with the program Erasmus which is paid by the government. French government pays the tuition fees of the university and give money to the student while his/her journey in the country. In addition, bank such as Credit Mutuel has few “envelopes” to lend money to the bank but the French government would be the sponsor.
9 - Social mobility 2.0
France provides free school to have equity between all French. According to The Guardian, "A child born into a low-income family in” France “would take an estimated “ six “generations to earn the average income.” Moreover, Lives writes that “Today, young people from higher social classes are still five times more likely than their working-class counterparts to graduate from a Grande École.” Therefore,
French social mobility is still very low.
10 - Share of all jobs in small businesses 4.0
In 2017, the total number of small and medium-sized enterprises (SMEs) was 2,960,560 with 18,596 of medium-sized, 2,824,470 of micro, and 117,494 small enterprises. Medium-sized enterprises can have from 50 to 249 employees, small enterprises from 10 to 49 employees, and micro enterprises from 1 to 9 employees.
11 - Freedom from outside control 4.8
France has its own domestic laws but also citizens or non-citizens who are in France are under European laws as well. Therefore, during a judgement French and European laws are taken in consideration. Moreover, French are not restricted and follow the rights of man in society are liberty, equality, security, property.
12 - Protection of domestic enterprises 4.5
French prime minister, Edouard Philippe, tries to preserve “made in France.” France tries to make it harder for foreign businesses and creates new regulations. Moreover, creation of tickets will be apply to businesses which do not respect their agreements during creation of their business. According “Les Echos” (french news paper), the government wants to be able to take “petits tickets” (=small tickets) in foreign businesses. For instance, government wants to do an OPA (= Offre Publique d'Achat) which is to tell a business that the government wants to buy a part of it for a certain price and limited time.
13 - Foreign currency transactions 4.0
Euro is only currency in France. Therefore, foreign currency must be converted by euros to make transactions in the country. Moreover, in 2015, Euro is 21% of the currency reserve global, in consequence, it is easy to exchange a foreign currency in euro anywhere.
14 - Border control 4.5
Schengen area, created in 1985, established a free border control area between countries which are part of Schengen area. However, not all European Union countries are in Schengen area, only 22 out of 28 countries from European Union, France included. In addition, France border is connected to 8 countries form European Union: Germany, Italy, Suisse, Spain, Belgium, Monaco, Andorra, and Luxembourg. In 2015, France export and import are mostly from European country. The top export and import destination of France is Germany. Moreover, “la douane” is in charged of what get in and out of the country.
15 - Currency 4.0
In January 1999, the currency “euro” (€) was created and it was another step of Maastricht treaty. In December 31st 2001, euro was officially adopted as French new currency, and coins and bills started to be used. Euro is the only French currency used and euro is also used by the European Central Bank. Moreover, since 2015, 19 countries out of 28 countries use euros as currency, such as Germany, Spain, Italie. In addition, in 2019, the monthly average for the dollar to euro exchange rate was 0.85€ for $1. According to finder, “The euro, since its introduction, has become the second most held international reserve currency.”” Euro’s share of its currency reserve increases by 21% since 2018.
16 - Cultural, language homogeneity 2.0
France has only one official language, French. However France welcomes a lot of different culture, especially from Africa. According to the latest National Institute of Statistics and Economic Studies figures, 6.5 million immigrants lived in France in 2018, representing 9.7 percent of the total population. France is opened and welcomes a lot of different culture which creates a lot of issues. For instance, in 2019, Marseille was “Capitale européenne de la culture” (European capital of culture). However, according to an Ipsos poll in September 2019, 65% responded that accepting migrants did not improve the situation in France and 45% responded that accepting migrants deprived the French of social services. Therefore, having a lot of different culture in a same country increases the difficulty of conducting commerce and raises the possibility of armed conflict.
17 - Political effectiveness 2.5
Since 2019, number of manifestation increased, specially for yellow jacket. The consequences of these amount of manifestation that French government could not handle decreased GDP of 1.7%. It affected unemployment, American and asian touristic, and businesses. Yellow jacket creates more than 60,000 damages which are worth between 100 and 200 millions of euros. However, French terrorist attack protection is very efficient since 2013, the government has avoided 60 terrorist attacks.
18 - Institutional stability 3.5
Since 1848, France is a democratic country, and is governed by a president. Since 1848, France has been under five different constitutions. Since 1958, French are under “la Cinquième République” (fifth democracy), and, for now, this constitution is the most stable. Emmanuel Macron, French president, is trying to maintain institutional stability in the country. Our democratic politic has different parties in it. For instance, E. Macron is the founder of “La Republique en Marche!” It is a liberalism, social liberalism and pro-europeanism party, even though E. Macron does not refer himself as a socialist. French institution is constitute by The prime minister, The Conseil des Ministres, The Assemblée Nationale, and Sénat.
19 - Honest government 4.0
French corruption rank has an averaged of 21 and a score of 71 out of 100 which means on a scale of 100, 100 is very clean about corruption. According to orange actualité, 84% of French citizens do not trust Macron, and 72% think that macon decreased buying power. They think that Macron will not be able to help in increase French economy. Moreover, France is the 21 least corrupt nation out of 175 countries, according to the 2018 Corruption Perceptions Index reported by Transparency International.
20 - Common laws 3.0
France has a system of "Civil law” which was created in 1799 by Napoleon Bonaparte. Civil law is divided in two part “public law” and “private law.” “Public law” are use for public people and private which can appear in a public area such as university. However, “private law” just applies between private people which can be moral or physical. For example, social law is a private law. Moreover, poor and rich do not have equal rights. For instance, legal aid is only 45e per hour so it is hard for low income to get good quality defense. However, high income can hired good lawyer and have better protection. On the other hand, France is one of the best country to redistribute money from rich to poor. Poor have a lot of rights to help them with their needs, such as “Sécurité sociale” or “CAF.” Also French who has better income are taxed more than normal income or low income which usually are not taxed by French government. For example, people with income of 152,000e per year are taxed 45% against 0% for income below 10,000e per year.
21 - Central Bank 3.5
Banque de France (Bank of France) is the central bank. It was founded in January of 1800 by Napoleon on Bonaparte. The Banque de France’s system of governance is independent institutions governed by French and European law. From its creation until now, the Banque de France has grown and gained responsibilities.
Their three main responsibilities are:
Ensure monetary stability
Ensure financial stability
Provide specific services for public authorities, businesses and individuals.
The Banque de France is very important for the stability and keep everything in order.
22 - Domestic budget management 2.0
In 2019, French domestic budget is 390,8 billiards of euros which is used for different purposed. The four main government spending area are tax repayments and abatement (135 883 million of euros), education (72 760 millions of euros), defense (44 354 millions of euros), and state’s financial commitments (42 471 millions of euros). In 2019, the amount of government spending increased of 1.03%. Moreover, French domestic budget is 96.8% of GDP. Moreover, according to the Maastricht treaty, French public deficit is - 2,6 of GDP which is positive and keep decreasing.
23 - Government Debt 1.0
Since 1980, French government has grown bigger and has accumulated a very heavy debt. In November 1st 1993, The “dette au sens de Maastricht” (french government debt) needs to respect a few criteria such as debt cannot be more than 60% of GDP. But, the French government keeps growing and has almost reached 100% of GDP. In 2017, the French government debt had reached 96,8% of GDP. This percentage of debt means that 96,8% of the market value of all finals goods and services produce within France in one year represents the value of the debts.
24 - Economic statistics 1.0
French economic statistics are not encouraging, and people are getting more worried for France future because France is an open free market but unemployment rate is very high 8.5%, especially for your youth. Manufacturing output also decrease of 1.2% and as a whole industry decreased of 0.9%. Other manufacturing decreased as well. The overall regulatory frame work remains relatively efficient, but the labor market has difficulty because of the rigid regulation and high unemployment rate. Moreover, total national income is made of 45.3% of tax. The government debt had increased and had almost reached 100% of GDP which means that the French market value is almost the same value as the GDP.
25 - Protection of public health and safety 4.0
France has a good health care called Sécurité sociale. The Sécurité sociale protects people and help financially to pay their health care. Taxes that employee and employer pay are collected by Sécurité sociale. In 2019, the health spending for health care is 1421 milliard of euros which means 11.2% of GDP. Most of health care are refundable in totally or most of it.
26 - High wage policies 4.0
February 11th, 1950, France established a new law called SMIG- Salaire Minimum Interprofessionel garanti (guaranteed minimum interprofesional salary). SMIG’s wage for Paris was 78 centimes (0.86 US cents), and SMIG’s wage in other area was lower. But in 1970, SMIG was replaced by a new minimum wage called SMIC. SMIC- Salaire Minimum Interprofessionel de Croissance (The guaranteed minimum growth wage) is the legal minimum hourly wage in Metropolitan France and in the overseas departments. Nowadays, SMIC’s wage is 10,03 € for a person over 18 years old and 8,02 € for a person under 17 years old which is 80% of SMIC.
27 - Environmental protection 4.0
In 2019, French environmental budget was increased of 3.1% which is a total budget of 34,2 billion of euros. French environmental budget includes all the factors which help to decrease waste such as sewage management. France is trying to reduces 50% of waste until 2025. In 2021, France plans to increase the general taxations on polluting activities (TGAP- taxe générale sur les activités polluantes). France also signed “l’accord de Paris” which is an international treaty to regulate the global temperature increase under 2 degrees Celsius. Moreover, France is very serious about its commitment to save the environment, and has a lot of ambitious to save our planet. For instance, France offered 20 millions of euros to help to stop the fire in Brazil.
28 - Strong Army 4.9
French Army is commanded by the minister of defense. France has 4 different categories of army.
Armee de l'Air (Air Force) protects national airspace. They can also act outside and inside french territory. They can also help to rescue civil, and civil emergency mission. Moreover, they collect data from nation airspace and transfer it to their " Etat Majores" (supervisors).
Armee de Terre (Land Force) is acting on the national land but also in land foreign country.
Armee de Mer (Navy) they have action on the sea but also on land. They collaborate a lot with the Air force and protect the border.
They also are in permanent mission which is where the nuclear bombs are to dissuade oponant to start a war. Gendarmerie Nationale (National Force) is one of the police national part. The "Gendarmerie Nationale" has the same training as the military because of their training they are considered as military, and they can be called for a defense missions (inside and outside of the country)
When french army is needed air force, land force, and navy are called and work together. Only in some conditions National force is called. Moreover the French Army budget, in 2018, is 34.2 billion of euros which is 1.82% of GDP. Moreover, France plans to have a budget of 50 billion of euros in 2025 and increases until 2% of GDP.
29 - Foreign trade impact 4.0
Being the second largest exporter and importer in Europe, since 1995, France has been part of the World Trade Organization. According to global alliance of SMEs, France “exports a number of valuable commodities including machinery and transportation equipment, aircraft, plastics, chemicals, pharmaceuticals, iron, steel, consumer products, petroleum and cars & vehicles. A major part of this foreign trade is carried out with European partners including Germany, UK, Spain and Italy.” Moreover, according to the CIA World Factbook, “France exported US $490 billion worth of goods and services in 2006.” Additionally, its exports of goods and services is 30.88% of GDP. Moreover, France imports are more important, US $529.1 billion, its imports of goods and services is 31.98% of GDP . France mainly imports cars, vehicle, machinery, equipment, crude oil, plastics, chemicals and aircraft. However France has a negative balance of US 39.1$ even though it has an important foreign trade.
30 - Management of foreign currency budget 2.0
Increase of publics debt from France did not begin yesterday. It began since 1933 the Bank of France has been confronted with an outflow of gold. It was measured in terms franc (previous French currency), the Bank's gold reserves were 81.1 billion francs in 1933, 78.9 billion in 1934, 75.3 billion in 1935, 57 billion at the end of May 1936 and 50.1 billion in September 1936. But nowadays, Public debts are measured in Euros, and French public debt is very worrying because French debts-to-GDP ratio has reached 98.9%.
31 - Layers of collective action 3.0
The principle of action is quite new in France. It was adopted in 2014. There are two different types of collective action. The first one is official, and only fifteen associations are allowed to do a collective action. According to the law of consumption one example is UFC-que choisir. UFC- que choisir is an organization which provides free service to consumers who have been cheated in real estate transaction with agencies like Foncia, and their services are free and available for everyone. Regardless rather people complain or not, they will fight individually or in class action law. Foncia was accusing for having taken 44 millions of euros to its consumers during a period of 5 years. This kind of collective action only takes care of real estate or furniture services. Those services are free and do not required a minimum amount of complaint. Unfortunately, this procedure is very long and it can take between 10 to 15 years. The other way is a non official way based on more people complaint more they have “power”. This method includes other unhappiness, and take single complaint until there are enough complaint to continue the procedure but the procedure needs some condition to go further such as having more than 100,000 people who complain, having the consumers’ advantage over the business, and that the business has the good condition for the government take taxes. In this process, the organization tries to make a deal with the business before going further. If the business does not want to make a deal and go further, it would not be collective action anymore but each complainer would go to the justice as individual complaint. However, if the business accepts the deal, the organization would take a compensation of 15%.
32 - Pro-business climate 4.0
France is a country open to the creation of new business and Emmanuel Macro, which is the France president, encourages people to create more business. France has a organization called Cosme to help to create, develop and extend a start-up, a TPE which is a very small-sized business or a PME which is small and medium-sized business. Cosme has two program:
La facilite garantie de prêt (the easy loan garantee) which finance and a guarantee for the bank
La facilité capital risque pour la croissance (the facility risk capital for growth) which help to get fonds for the business which invest in the new business
Cosme also provide an program called Socama which helps PME to get cars, materiel and money to improve building or build building. The help can go up to 30,000 euros. They also provide other different help.
33 - Government enterprises 2.0
France is the owner of different company such as SNCF which is railway company which was created in 1938. Unfortunately, the profit of this owner’s state is very low. The government spends more money in improving the railway and has a big deficit even though they state the opposite. SNCF has a profit of 9,2 billion euros but spent 14 billion euros.
In addition, French GDP in 2017 is $2,582,501,307,216. In France, the government total revenue include not only the enterprises but also taxation result the percentage of the government total revenue is 53,9% en 2017.
34 - International security agreements 4.0
France is part of the European Union which is an economical and political organization. France is also one of its founders. The European Union was created in 1950 with the “Paris Treaty” but at that time only six countries was included. Today, 28 countries remain in the European Union. European Union signed an agreement to stop the economic crisis.
France is involved in a lot of international agreements such as the agreement to stop and keep the peace at the end of the World War II in1947 which is called “Paris Peace Treaty”. France also signed an agreement to ally countries (North Amerca and European Union) called “The North Atlantic Treaty Organization.”
France is also in the G20 and very involved in the climate changes. France has signed in 2015 an agreement proving its complete commitment for saving the environment.
France is very evolved in international security agreement such as the environment with his implication for saving the Amazon in 2019.
35 - Protection of domestic enterprises from government mandated costs 2.0
French government established two different types of taxes for the enterprises. The first tax is the most important revenue collected by the government which is VAT, Value Added Taxes (TVA- Taxes sur la Valeur Ajoutée). VAT is the value added to the consumption which is collected by the enterprises and later transfer to the government. VAT is currently the highest rate in the European Union which is a rate of 20%. Moreover, there is CT- Corporate Taxes (IS- Impôt sur les Sociétés) which is a tax based on the annual income but not all enterprises are being taxed. The fee will be asked by the government according to the level of enterprise’s profits, and also the rate of taxation is going to be calculated according to the status of the enterprise and the annual income.
FRANCE - DAVID ROUXEL
This study presents a detailed study of the economic policies of France, as written by Specialist David Rouxel. The ratings herein are based on the following rating scale:
5.0 Perfect Facilitation of Wealth Creation
4.0 Midway between Perfect and Neutral
3.0 Neutral Effect on Wealth Creation
2.0 Midway between Neutral and Obstructionist
1.0 Perfectly Obstructionist to Wealth Creation
[Rating scale copyright Mike P. McKeever, 2019. Used herein with permission]
RATING SUMMARY - DAVID ROUXEL POLICY NUMBER RAW SCORE ADJUSTED SCORE POSSIBLE PERCENTAGE 1 5.0 15.0 15.0 100 % 2 4.8 14.4 15.0 96 3 4.1 12.3 15.0 82 4 4.5 13.5 15.0 90 5 4.7 14.1 15.0 94 6 4.5 13.5 15.0 90 7 5.0 15.0 15.0 100 8 4.4 13.2 15.0 88 9 2.9 8.7 15.0 58 10 4.5 13.5 15.0 90 11 4.0 12.0 15.0 80 12 4.1 8.2 10.0 82 13 4.2 8.4 10.0 84 14 4.5 9.0 10.0 90 15 5.0 10.0 10.0 100 16 4.2 8.4 10.0 84 17 4.1 8.2 10.0 82 18 4.2 8.4 10.0 84 19 2.7 5.4 10.0 54 20 2.8 5.6 10.0 56 21 4.0 8.0 10.0 80 22 2.5 5.0 10.0 50 23 1.7 3.4 10.0 34 24 4.9 9.8 10.0 98 25 4.3 8.6 10.0 86 26 4.6 9.2 10.0 92 27 4.4 8.8 10.0 88 28 4.3 8.6 10.0 86 29 4.0 4.0 5.0 80 30 2.4 2.4 5.0 48 31 4.3 4.3 5.0 86 32 3.9 3.9 5.0 78 33 3.0 3.0 5.0 60 34 4.0 4.0 5.0 80 35 2.0 2.0 5.0 40 TOTAL 138.5 301.8 370.0 81.6% ===== ====== ===== =====
FRANCE - INDIVIDUAL POLICIES - DAVID ROUXEL
1.Freedom from internal control. 5.0
The free movement of workers in the countries of the European Economic Area (EEA) is a fundamental right for the people of these countries to work in another EEA country under the same conditions as their country's citizens. France is an EEA member. Thus, moving to and from France is simple. Freedom of movement between European Countries has gradually appeared since the 1995 Schengen Agreement vote. In addition, French citizens do not need public approval to establish new company inside their nation. Thanks to this freedom of movement, they can establish themselves wherever they want creating wealth in the process.
In conclusion, French people are at their own discretion free to move around.
This is really important for wealth creation, for citizens to move freely without anybody harassing them.
2. Freedom of Speech. 4.8
The French Constitution safeguards liberty of speech. The French Constitution includes the 1789 Declaration of Human and Civic Rights, which safeguards liberty of expression. Article 10 of the Declaration of Human and Civic Rights states that "No one may be disturbed by his or her views, even religious ones, provided that the manifestation of such views does not interfere with the law and order established." According to Article 11, "Free communication of thoughts and views is one of the most valuable freedoms of man. Consequently, any citizen may talk, write and publish freely, except in instances determined by law, which amounts to the abuse of that freedom."
In other words, the French Constitution acknowledges liberty of expression, but it also explicitly permits legislation that would restrict it. France is also bound by the European Convention on Human Rights, Article 10 of which also safeguards liberty of expression while recognizing the right of the State in certain conditions to restrict that liberty. Finally, there would be no full debate of liberty of expression in France without at least mentioning the Law of 29 July 1881 on Press Freedom (Loi du 29 juillet 1881 sur la liberté de la presse), which is regarded to be one of France's fundamental legislation on liberty of expression. This 1881 law enshrines liberty of the press, but also sets boundaries on what can be published legally. As a result, France has no restriction on freedom of speech unless it affects negatively its citizens.
3. Effective, fair police force. 4.1
The National Police (Police nationale), together with the National Gendarmerie and France's main civil law enforcement agency, is one of two national police forces with primary jurisdiction in towns and cities.
Most of the National Police works in big towns and cities. In this sense: it carries out safety activities (patrols, traffic control, identity checks) under the orders and oversight of the judiciary's investigating magistrates, performs criminal investigations, serves search warrants.
A very thorough entrance exam to get work as a law enforcement officer weeds out most of mentally unstable applicants and allow to have a police force that is ready to react to any situation but who is mostly trained to de-escalate situation rather than escalate them. As a result, France has a very fair police force with little to no complaints from its citizens.
4. Private property. 4.5
France is in the 9th position with a score of 85 of the property rights indexes which measures the degree to which a country laws protect private property rights, and the degree to which its government enforces those laws.
Higher scores are more desirable, i.e. property rights are better protected. Scores are from 0 to 100.
The index covers the likelihood that private property will be expropriated and go over the independence of the legal system, the existence of corruption within the legal system, and the ability of individuals and businesses to enforce contracts.
As a result, we can confidently say that France do protect its citizens and businesses property, whether it is real estate, personal, or copyrighted intellectual property.
5. Commercial banks. 4.7
With more than 26,000 branches, France the strongest banking industries in Europe.
Banking activities are heavily regulated by the government, preventing the abuses that north America has faced in the financial crisis of 2008. Indeed, French banks are very conservative with its depositors’ money. Resulting in no almost no systemic risks.
Banking activities in France are controlled by the Committee for Banking and Financial Control and the Committee for Credit Establishments and Investment Firms, under the Ministry of the Economy and Finances and the Governor of the Banque de France. The Banque de France is itself under the tight control of the European Central Bank.
As of September 2019, the four biggest French banks have around 9 Trillion dollars under their management.
6. Communication system. 4.5
France has a large and diverse communications system. The French government plays an important role in key communications services, including postal, telephone, and radio and television services. The press is very important in France. A lot of national and regional newspapers and magazines are important sources of information for France’s population.
More than 90 % of the French population is connected to high speed internet. The government of France made it illegal for private companies to overcharge costumers for internet. It is very easy for private citizens to access information through free national TV, free local newspapers or through very affordable internet. France, through its excellent communication system is perfect for businesses since a business cannot grow without a proper communication system.
7. Transportation. 5.0
France has one of the best public transportation system in the world with 146 km of roads and 3.85 miles of rail lines per 100 km2. All transportation system starts in Paris and spread all over France. La Sociétè nationale des Chemins de fer Français (SNCF) is the French national railway company. The total of railway in France is 51,415 km, one of the largest networks in the world.
France is the fourth largest highway network in the world. With 1,134,895 km of roads.
Many people enjoy an affordable public system in France thanks to the state of France sponsoring part of it through its strategy involving less cars on the road. In Paris, you can affordably go to work from the center of Paris to the suburbs in less time that it would take you to actually drive. Many western countries should aim to emulate how French public transportation is.
8. Education. 4.4
The French education system is one of the best education systems in the world, with a nationally set curriculum, traditional methods of learning, high academic standards and strict discipline.
The French educational philosophy emphasizes:
-The authority of the teacher;
individual competition including an absolute grading system (no grading on the curve);
stress on analytical thought and rote learning as opposed to creativity;
generally high academic expectations.
-The French don’t necessarily expect children to have fun at school. Sports and creative activities are encouraged but generally organized by community or private associations, not by the schools.
-French schooling is free and mandatory from ages six to 16, although the majority of French children start earlier. Another two years of study are required if a student is to sit the Baccalauréat exam, which they must pass to enter university. Class sizes tend to be large, with one teacher for some 30 or more students, mostly due to fact that School is free, and that France is trying to maximize its capacity to save money.
9. Social mobility. 2.9
France have a social mobility ranking above the OECD average.
In France, there is a widespread perception that parents’ fortunes and advantages play a role in people’s lives. According to OECD, 44 % of people agree that parents’ education is important to get ahead in life. This perception is more pronounced than in most countries.
If you parents earning are earnings, there is a 35 % chance you will end with low earning yourself. Additionally, the type of occupation that you parents holds is important. Indeed, children of managers are twice as likely to become managers themselves as children of manual workers. This is close to the OECD average.
10. Share of All Jobs in Small Businesses. 4.5
In 2018, France had 3.8 million of SME (Small to Medium size Enterprises), or 98.9 % of all enterprises. These 3.8 million SMEs generated 43.2 % of France Gross Domestic Product (GDP).
In France, 51% of all jobs are held to companies fewer than 100 employees. Additionally, these companies contributed to 15.4 % of France’s exports.
This is partly due to the French government efforts to promote entrepreneurship and a myriad of tax breaks for very small businesses which allowed them to survive during hardships.
France is small business friendly because it knows that it employs a lot of people.
11. Freedom from outside control. 4.0
France has a strong protection from outside control and influences for its citizens. Indeed, not only a French citizen will be protected from the European Union which France falls under but also a myriad of laws protecting their safety, freedoms and privacy. France has always been a whistleblower among European countries. It does not extradite its citizens even to superpowers such as Russia or the United States. In recent years, France and the European Union has focused its effort in the fight against big American tech companies such as Facebook, Google and Apple. It wants to make sure that they cannot control the market in a monopolistic way which would hurt the freedom of choice for its citizens. The European Union listened to France’s worries and started its own Internet privacy commission in 2018.
12. Protection of Domestic Enterprises. 4.1
France's regulations and bureaucratic procedures can be a difficult hurdle for companies wishing to enter the French market. This is meant to protect French Enterprises from foreign competition. Complex safety standards, not normally discriminatory, but sometimes rigorously applied, complicate access to the market for many foreign companies. Many times, in its history, the French government has stopped a foreign company from entering its market through a merger and acquisition. France wants to enact more anti-takeover rules to protect companies deemed strategic as it walks a fine line between preserving a surge in investments and preventing its technology falling into the hands of foreign powers like China and the United States. As of September 2019, President Macron has been doing a good job in preventing aggressive takeovers.
13. Foreign currency transactions. 4.2
Euro is the French currency, therefore since it is the common currency of 19 countries in the eurozone, it is easily exchanged and appreciated internationally. It is very easy for private citizens, institutions and businesses to convert Euro against US dollar, Pound Sterling, Swiss France or any other major international currency. As of September 2019, the exchange rate for 1 Euro is about 1.10 US dollar. It has been at par with the US dollar very briefly in 2005 and never been ever since. The Euro is known to be stable and is appreciated almost as much as the US dollar. The Euro is backed by the European Central Bank. Additionally, the European Central Bank facilitates its uses through various incentives programs aimed to create wealth and for businesses to switch from the US dollar to the Euro.
14. Border control. 4.5
France is part of the Schengen Agreement. This agreement was implemented in June 1985. It defines a territory between its members where the free movement of persons is guaranteed. France shares its border with Belgium, Luxembourg, Germany, Spain, Monaco, Andorra and Italy. There it is very hard to control organized crime activities coming in and out of the country. Schengen is crucial for France since it tremendously improve, smoothens and guarantees the cooperation between the police and authorities of its members. It is very hard for criminals to operate in one of the Schengen member country since all its authorities work on one common goal: to stop crime and protect its members. Therefore, France has a very good control of its borders.
15. Currency. 5.0
France’s currency, The Euro, is the official currency of France as well of the eurozone. The euro is the official currency of 19 of the 28 member states of the European Union. The eurozone (States using the Euro) counts about 343 million citizens as of 2019.
A key benefit of using the euro is that it removed exchange rate risk from eurozone businesses and financial institutions operating in an increasingly globalized economy. The Euro is managed by the European Central Bank. As of September 2019, 956 billion Euros are in circulation making the second largest reserve currency in the world. Businesses operating in a eurozone country can freely sell their merchandises and services in 19 different countries, which is a tremendous advantage.
16. Cultural, language homogeneity. 4.2
The official language of France is French and is the first language of 88% of the population. Most of those who speak minority languages also speak French, as the minority languages are given no legal recognition. About 1,000,000 people or 3% of the population speak German dialects, predominantly in the eastern provinces of Alsace-Lorraine and Moselle. Around 1m people near the Italian border, roughly 2.4% of the population, speaks Italian.
In the South of France, over 7m speak Occitan dialects, representing 12% of the population of France. Arabic, the third largest minority language, is spoken by around 2.3% of the population throughout the country. Other immigrant languages from the former French colonies include Kabyle and Antillean Creole. the homogeneity of France is not complete. French society has become increasingly diverse over recent decades. For example, it currently has one of the largest Muslim populations in Western Europe. Muslim communities (largely made up of migrants from North Africa) have contributed to cuisine, literature and the arts in France. Some have embraced the influence of other cultures, while others believe that migrants should assimilate into the dominant French culture.
17. Political effectiveness. 4.1
France has always been very responsive to natural disasters. In 1999, severe storms paralyzed France. The government reacted quickly and utilized the military to clear major debris. The communication between the executive branch of the government and its first responders is excellent. Additionally, France, almost always declare a state of emergency for any major natural disasters allowing private citizens as well as businesses to be reimbursed by insurances very easily. Since 2001, the major threat to France has been terrorism. France has implemented an effective and well-funded program called VIGIPIRATE.
The name "Vigipirate" is an acronym of vigilance et protection des installations contre les risques d'attentats terrorists à l'explosif ("vigilance and protection of installations against the risk of terrorist bombings).
18. Institutional stability. 4.2
As of 2019, France is a democratic republic with a multi-party system. Its politicians are elected through direct universal suffrage. France has always been pretty stable institutionally wise but lately, President Emmanuel Macron launched an ambitious reform program, aiming at fixing France’s structural challenges and bolstering the economy’s resilience. those reforms were received by a wave of protests (initially led by trade unions), that turned into a popular movement, the ‘gilets jaunes’ protesting initially against fuel taxes. Their demands are as varied as the end of austerity measures, improved standards of living and public services in rural areas, resignation of President Macron and his government, the protests are still ongoing.
France faces structural challenges: high structural unemployment, weak competitiveness, and high public and private debt burdens. High unemployment rates, especially among youth, remain a growing concern for policymakers. Despite its gradual decline, unemployment rate remains high, estimated by the IMF at 8.8% in 2018. The labor reform passed in 2017 aims at injecting more flexibility in the labor market.
19. Honest government. 2.7
As of January 2019, only 25 percent of people surveyed by Odoxa and Dentsu Consulting for franceinfo said they trusted the French government’s action. Macron came to power in mid-2017. Campaign promises have not been respected and the growing Yellow vest movement clearly displays the general distrust of the people towards its government.
The biggest political priority for 54 percent of French is to find a way to boost purchasing power, the poll found, while reducing unemployment. The government has failed to provide this for the people and has been under the scrutiny for several political scandals involving overpaid senators and other mayors. As a result, it is harder for businesses to operate in France due to political instabilities, national social movements coupled with strikes which slows down France’s ability to create wealth.
20. Common laws. 2.8
In France, the law is complex, and therefore the skillset of who you hire to defend yourself in court matters. To this extent, France, despite having public representants available at a lower cost, is not fair and unequal. The wealthiest, can and will use very experienced and expensive legal representants and most often we will their cases against inexperienced, affordable public legal representants.
Most English-speaking countries fall under common laws, France is not under common laws but under civil laws. Generally speaking, a civil law system is more prescriptive than its common law counterpart. It is largely based on Roman law. Therefore, it could be a little complicated for Anglo-Saxon businesses to do business in France because oftentimes they ignore the subtleties of the civil laws system. France law is usually composed of two areas: Private law (which deals with civil law and criminal law) and public law (which deals with constitutional law as well as administrative law).
21. Central bank. 4.0
La Banque De France (“Bank Of France”) is France’s central bank and is financially to the European Central Bank. It is headquartered in Paris, the capital of France. La Banque De France implements and controls the interest rate policy throughout the country.
La Banque De France was created by Napoleon Bonaparte in 1800.
Bonaparte wanted to grow the economy, and to deal in a more efficient way to future recessions. France was financially devastated by its ongoing wars.
La Banque De France was not actually nationalized until 1946, until then it was privately operated.
The bank was then privatized in 1993 and was done so to prepare for the change from Francs to Euros. Euros were made the currency of France in 1999 replacing the Francs. La banque de France oversaw the whole operation and made sure it was a smooth transition for businesses as well as private citizens.
To this day, La Banque De France sets the interest rates for other banks to adhere to; loans, finance and mortgages are all controlled by the decisions made by La Banque De France. It is under the supervision of the European Central Bank.
22. Domestic debt management. 2.5
Since 1974, France has not known a balance domestic budget. This could be attributed to several factors including high structural unemployment, rising cost of government sponsored healthcare, the reduction of the working from 40 hours per week down to 35 hours per week, and others.
As of 2018 France’s 2018 budget plan sees its structural deficit falling 0.1 percent of its GDP this year and 0.3 percent of its GDP in 2019.
This constant deficit is detrimental to the expansion of businesses since to pay for a deficit, France has to borrow the funds somewhere else, decreasing the amount of available funds for businesses.
personal knowledge and experiences.
23. Government debt. 1.9
In 2018, Government debt amounted to 98.40 percent of the country's Gross Domestic Product. From 1980 to 2018, Government Debt to GDP in France averaged 58.73 percent reaching an all-time high of 98.40 percent in 2017 and a record low of 20.70 percent in 1980.
This demonstrates that France is faced with several challenges. One of them is the future inability to create and support activities or businesses creating wealth. Indeed, debt has a negative effect on France’s economy, because the servicing of that debt is taxing other wealth creating activities.
24. Economic statistics. 4.9
France has more than plenty of accurate, good quality and relevant statistics that businesses can use for free. France has four national Economic statistics entities:
The National Institute of Statistics and Economic Studies (Institut national de la statistique et des études économiques INSEE)
The National Institute for Demographic Studies (Institut national d'études démographiques INED)
The National Council for Statistical Information ("Conseil national de l’information statistique CNIS")
-OFFICIAL STATISTICAL AUTHORITY
The Official Statistical Authority (Autorité de la statistique publique ASP)
25. Protection of public health and safety. 4.5
France is known for its good public health and safety mainly because of our universal health care coverage. As of 2019, France Spends 11.54 % of its GDP on healthcare, the highest in the European Union. French citizens are deducted out of their paycheck an amount, which varies based on their income, into a social security fund. This fund is then used by the government to cover the cost of national health insurance. This is a fair system, where everybody gets treated no matter what, because France treats healthcare as a human right, not a luxury.
In France, gun ownership is prohibited, therefore violent crimes are rare. Petty crimes such as theft are more common in 2019 than a decade ago, mostly due to the fact that the economy is not the best for young unqualified workers and single parents.
26. High wage policies. 4.6
In France, there is a national minimum wage, called SMIC (salaire minimum de croissance) which stands for minimum growth wage.
France’s SMIC, in 2019 is 10.03 Euro per hour, or the equivalent of 1,521.22 Euro per month, based on a 35-hour working week.
The whole country of France operates a flat minimum wage system which applies to everyone, except:
-People aged under 17 with fewer than six months of experience in professional work can be paid at a level of 80% of the minimum wage until they are 17, then at 90% of the minimum wage until they are 18.
-People with apprenticeships, meanwhile, can receive anything from 25% to 78% of the minimum wage depending on their age and level of experience.
France is one of only seven European member countries that pays a minimum wage of more than 1,000 Euro per month.
France care about being able to give its citizen a living wage, not just a ‘surviving wage’. It is key for a strong domestic market, which France has.
27. Environmental protection. 4.4
Environmental laws have been enacted in France since the 1970s. In 1976 France implemented two laws, one on the protection of nature and one on the facilities classified for environmental protection ("installations classées pour la protection de l’environnement).
Since 1990, Paris has become the epicenter of achievements in the field of environmental protection. Paris Agreement of December 2015 on climate change, the passing of the 2016 laws on the energy transition for green growth, and concluding with the international launch by the President of the French Republic Francois Hollande followed by Emmanuel Macron of the Draft Global Pact for the Environment in 2017. Ever since, President Macron has been fighting on the international scene to promote a more sustainable future for generations to come. France is doing what it is supposed to: To lead the developed nations through example into switching for a greener future. France is under the European Protection Agency (Agence Europeenne pour l’environment) which regulates everything from nuclear waste, to water quality in France.
28. Strong army. 4.3
France’s manpower in 2019 is as follow:
-Available Manpower: 30,111,868 (44.7%)
-Fit-For-Service: 23,818,487 (35.4%)
-Reaching Military Age Annually: 776,483 (1.2%)
-Total Military Personnel: 388,635 (est.) (0.6%)
-Active Personnel: 205,000 (0.3%)
-Reserve Personnel: 183,635 (0.3%)
France’s military budget for 2019 is roughly $40B in total. France has a great air force, ranked 8th in terms of total aircraft strength and 7th in terms of total helicopter strength. France operates 1,248 different aircraft and 566 helicopters.
France’s navy is pretty good with 118 naval assets in total, including four aircraft carriers.
France continues to increase defense spending, with a 5-percent increase had from 2018, and cyberdefense is a major area of focus. For 2019, the nation of France is ranked 5 out of the 137 most powerful nations on earth according to the Power Index (PI) ranking of 2018.
29. Foreign trade impact. 4.0
As of 2018,
France exports of goods and services as percentage of GDP is 30.88% and imports of goods and services as percentage of GDP is 31.98%.
France Exported ($516B) and Imported ($595B).
France is one of the world’s foremost exporting countries, with the value of exports representing more than 20 % of its Gross Domestic Product (GDP).
France is also a significant importer of equipment, chemical products and chemicals, tropical agricultural products and traditional industrial goods such as garments and textiles.
The high amount of imports resulted between the mid 1970s and early 1990s to a trade deficit for much of the era. However, France has had a lighter trade deficit since 1992, thanks to invisible (non-merchandise) transactions like tourism.
30. Management of foreign currency budget. 2.4
As of August 2019, the government is rolling out its structural reform agenda, with three goals: unleashing initiative, overhauling the welfare state to protect citizens better, and investing in a sustainable growth model. France's Government debt accounted for 99.6 % of the country's Nominal GDP in March 2019, compared with the ratio of 98.4 % in the previous quarter.
It is relatively under control compared to other members of the European Union but definitely needs to be bought down below 95 %. Servicing France’s national debt is getting too expensive and unsustainable despite a stable economy.
31. Layers of collective action. 4.3
In France Decisions are made on every layer. Every layer’s representatives are elected by the people for the people. When the highest layers try to enact policies and to make decision that people from lower layers disagree with, the people have the right to protest and to ask for this decision to be reconsidered. Lower layers will try to make deals with higher layers through strikes, collective bargaining and their respective unions.
Every Decisions in France takes times because it goes through several instances.
One reform usually isn’t passed right away, it takes several times and multiple back and forth for people to consider it and finally approve it.
The top Military, Police, and public servants’ positions are not elected by the people but by representatives that people elect to vote for their best interest.
32. Pro-business climate. 3.9
France has always been Pro-business, despite having high corporate taxes and strong unions capable of organizing national strikes that have oftentimes paralyzing France’s economy. France, has many city and county programs including a law that helps to create a business for unemployed or under-qualified people l’Aide aux Chomeurs Créateurs ou Repreneurs d'une Entreprise (ACCRE). the problem that France is facing is higher taxation on big enterprises demanded by social movement such as the yellow jacket movement called Les gilets jaunes. The current French administration is very Pro-business but are hindered by societal problems that prevent them from implementing their desired pro-business policies.
33. Government enterprises. 3.0
France has been, since World War II, selling portions of their public holdings. Through securitization and privatization of these public entities, the government was hoping to shield itself from the exposure of the financial debt that these public entities were holding. Indeed, in France many companies such as the S.N.C.F, France’s main railroad public company was losing money decades after decades preventing any possible competition to enter the market.
L’Agence des participations de l’état( APE) is a special agency of the French Republic managing the state's holdings in about 70 firms, including France Telecom, Renault , S.N.C.F and Air France. Since 2008, and the demises of the financial crisis, it has been decreasing its stake in French public companies by roughly 11%.
As of 2019, the French administration is forcing public companies to be run more efficiently, through various law being enacted, creating social unrests in the process.
34. International security agreements. 4.0
France is part of the European Union:
The EU or European Union was created as the European Coal and Steel Community ( ECSC) and the European Economic Community (EEC) established respectively, by the 1951 Treaty of Paris and 1957 Treaty of Rome. The original members were known as the inner Six: Belgium, France, Italy, Luxembourg, the Netherlands and West Germany.
The European Union was created to be a deterrent to future wars and to build a strong economic area.
As of 2019, The EU is composed of 28 members states.
France is part of the North Atlantic Treaty Organization (NATO):
Organisation du traité de l’atlantique nord; OTAN.
It is a collective defense system including 29 countries.
France has been part of it since its creation on April 4th, 1949.
35. Protection of domestic enterprises from government mandated costs. 2.0
French enterprises are subjected to three categories of taxes:
-Corporate Income tax (CIT): impôt sur les sociétés.
As of August 2019, the corporate income tax rate for France is 33.33%.
A social contribution of 3.3% is payable if the corporate tax is more than 763,000 Euro.
A special contribution of 10.7% of the corporate tax has to be paid if turnover is more than 250 million Euro.
Thanks to recent financial reforms such as President Macron’s Finance Law of 2018, the normal corporate tax rate will be 28 % in 2020 and will gradually become 25 % by 2022.
-Value added tax (VAT): Tax sur les valeurs ajoutées.
French enterprises collect this tax for the French government and has to pay it directly to the treasury department. The standard VAT rate in France is 20%. Reduced rates are 5.5% and 10% for food and cultural products respectively.
- City and county taxes: fiscalité directe locale.
These Taxes are made of three components:
1)Economical county contribution:
Contribution économique territoriale : cotisation foncière des entreprises (CFE). The tax rate varies by counties and is constantly updated.
2)Tax on the amount of VAT collected.
cotisation sur la valeur ajoutée des entreprises (CVAE).
The tax rate is 1.5% for any given company collecting more Ä500,000 per year.
3)Property Tax: Taxe foncière (TF).
Tax varies by city. This tax is based on your real estate property value at the end of the fiscal year.
France taxes heavily its enterprises. The mandated costs are high. Although,President Macron is trying to change this through various financial reforms that will be enacted in 2020.
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