FREchapter17business

Handout 16

Chapters 17-18-19: FRENCH ECONOMY Key words:

decentralization (began in 1972, with the regionalisation. Delegation of administrative power to Regional authorities by law in 1982)
nationalization/ privatization

in 1981 wave of nationalizations of private companies by the Left Government (banks/ steel industries etc.)
in 1986 wave of privatizations by the Right -wing government in power
in 1993-6 same: privatisation of BNP, RHONE POULENC, ELF -AQUITAINE, SEITA, 30% of RENAULT, THOMSON...

Up to date information:Check the web sites:

http://www.france.diplomatie.fr/france/gb/eco/index.html

check titles: Economic policy/ Key economic sectors/Town economic planning and Regional Development.

Very concise summaries on economy: http://www.france.diplomatie.fr/france/gb/tour/economie.html
http://www.france.diplomatie.fr/culture/france/ressources/letour/gb/index.html

Some facts 1. AGRI-BUSINESS: France is number one in agriculture in Europe (click: Economy and social situation) .It is also the world's second largest exporter of agri-foodstuffs, behind the USA, and in 1999 had an agricultural trade surplus of over 50 billion francs ($8.3 billion). Although French agriculture now employs only 6% of the total workforce and accounts for only 2% of the national GDP, it is nonetheless one of France's most dynamic sectors. During the last three decades, it has undergone a remarkable modernisation leading to a spectacular increase in
productivity and yields. This radical change has affected not only rural landscapes and production methods, but also people and their attitudes. The traditional farmers with their small family farms have been replaced by modern farmers running farms as businesses using modern technology and management methods.

2. The Main French industrial sectors:
http://www.france.diplomatie.fr/france/gb/tour/economie.html
Nuclear energy [EDF]

Agri-foods : wine, cereals, milk products, sugar beets, oil seeds [DANONE]

Luxury products:
-fashion/clothes- perfumes, leather goods, glassware [HERMES/CARTIER]

Pharmaceuticals [RHONE POULENC]

Automobile industry [RENAULT/PEUGEOT/CITROEN]

Materials processing:
[metaL PECHINEY, steel USINOR, glass STGOBAIN,rubber MICHELIN,ciment LAFARGE-COPPEE]

Construction/civil engineering [BOUYGUES]

The French High Tech industries are:
Telecommunication [FRANCE-TELECOM/CEGETEL]

Aerospace[AEROSPATIALE part of the consortium AIRBUS INDUSTRIES/DASSAULT/SNECMA]

2 a. The Leading French industrial Companies
(source:http://www.france.diplomatie.fr/culture/france/ressources/letour/gb/index.html

Based on their turnover, the twenty biggest French companies are:

        1.Elf-Aquitaine (energy)
        2.Renault (automotives)
        3.PSA Peugeot-Citroën (automotives)
        4.La Compagnie générale des eaux, now renamed Vivendi (utilities)
        5.Alcatel-Alsthom (electronics)
        6.Total (énergy)
        7.La Lyonnaise des eaux (utilities)
        8.Rhône-Poulenc (chemicals)
        9.Danone (food production)
       10.Usinor-Sacilor (métallurgy)
       11.Bouygues (building and publics works)
       12.Thomson (electrics)
       13.Saint-Gobain (building materials)
       14.Péchiney (métallurgy)
       15.Michelin (automotive accessories)
       16.Schneider (electrics)
       17.L'Oréal (cosmetics)
       18.Lagardère Groupe (communications)
       19.Aérospatiale ( aircraft construction)
       20.Saint-Louis (wood and paper)

ACTIVITIES

1. Can you identify the French regions on your map and match the "capital" of each?

2--LEADING FRENCH COMPANIES AND SOME of their US SUBSIDIARIES ( )

AXA (The Equitable) insurance
CARREFOUR /AUCHAN- Supermarkets-Distribution
ELF AQUITAINE* (Elf Atochem North America, Sanofi, Taxasgulf) petrochemical
MICHELIN (Uniroyal-Goodrich) tires
EDF ^- Energy: France nuclear plant system
GDF ^- Energy: France Natural Gas.
PECHINEY *(American National Can) packaging
RENAULT *(Mac trucks) Car manufacture (30% privatized) /PEUGEOT SA.
RHONE-POULENC* (Rorer, Applied Immune Sciences) chemicals, pharmaceuticals
SAINT GOBAIN (Norton, Certainteed) construction materials
SNECMA (CFM International) jet engines /DASSAULT
SNCF# : Transportation
SEITA*: tobacco company
THOMSON S A * consumer and defense electronics
TOTAL (Vickers, Sartomer) petroleum products
USINOR/SACILOR (Francosteel, J & L Specialty Steel, etc.) metal fabrications
DANONE (former BSN) food products
L'OREAL (cosmetics)
SANOFI (Pharmaceuticals)
AIR LIQUIDE (GAZ)
BOUYGUES(Public works , construction)
MATRA (engines)
LAFARGE-COPPEE (Ciment, aggregates)
Crédit Agricole, BNP*, Paribas*: Banks privatized between 1986 and 1994-6

Questions:
a. View : video on reserve French industry today. Identify companies and sectors of activity mentioned in the video. See the list above :check the companies that you recognize on the list above and add to it if need be.

b.What sector of the industry do these companies belong to?

First (agriculture/ natural resources)/ Second (industry-transformation) / Third (Services)?

c. What companies are national companies(^), or have been nationalized? privatized (*)? Have a Mixed Economy (#)? Are private companies?

4--IMPORTANT FRENCH BUSINESSES/PRODUCTS

EVIAN
Airbus
Concorde
Gauloises, Gitanes
Air France
Lacoste
Ariane,
Atom (Framatome, Cogema)
Baguette (Vie de France), Gastronomy
Bic
Michelin
Bordeaux
Mirage
Wines
Le Monde
Camembert
Cognac
Meridien
Dior Perrier
Cartier
Peugeot
BNP
Metro
Champagne
Radar (Thomson-CSF)
Chanel
Renault
Rossignol
Alcatel-Alsthom (CGE subsidiary)
TGV (high-speed train)
Citroën
Vuitton
Club Med
Le Creuset-Cousances
Yves St Laurent
Renault
Kronenbourg (Danone)
Guerlain
Minitel

Questions:

Try to identify what product is targeted by the above terms (some are products, some are companies). Say which sector of the industry and activity ( Tourism/ Food/ Heavy-steel industry/ Luxury products/ Manufacture./ High tech/ Communications etc.) these belong to.

Role-play :

Check the web site:http://www.info-france-usa.org (economy)--click: "Open for Business"/regions/ visit regions one by one.
Check the INVEST IN FRANCE AGENCY SITE: IFA . Where are the top regions for investments ?

Imagine you are a CEO in the US and you are setting up a business or a subsidiary in France. Determine: what is your company and product? where are you based? Which French region would you settle in and why ? (strategic location? regional grants, tax incentives from the DATAR? and Regional Council?)

Revision questions:

1.What do the DATAR?and the IFA? stand for?

2.What are vulnerable areas in France: areas of industrial decline/ rural areas? e.g.?What other funding resources do the French regions get ?

3.Read article The State of France in your packet (handout 15 supplement):

-W

Société d'économie mixte (SEM

4.View videos on reserve: French Industry Today ( and France Beyond Borders. View Part II.)

Identify: Pierre CARDIN, DIOR, Champagne, BOCUSE, SOPHIA ANTIPOLIS, SQUIBB LABS .
Indicate two things you learned in these video about French industry.

5. What are the issues with the French Agri-business?
6. Name a few companies that are leaders in the three main sectors of the French economy (Primary , secondary and tertiary)
7.What are France's traditional industries?
8. What are France's new industries?
9. Give some names of famous brands of French products