US firms fall out of love with France, survey says
The attractiveness of France as a place to do business has plummeted in the eyes of the French divisions of US businesses, a new survey suggested this week. The May 2012 election of a Socialist government was cited as the main reason for the drop.
The return to power of France’s Socialist Party in the spring of 2012 after a 17-year absence has not gone down well, it seems, with American businesses with operations in the country.
According to a recent poll of the heads of French branches of US companies, France's attractiveness as a place to do business has plummeted in the last year.
The survey, carried out by the American Chamber of Commerce in Paris along with consulting firm Bain and Company, revealed only 22 percent of the heads of the US companies in France see the country as an attractive place to do business, down from 56 percent when the same poll was carried out in 2011.
The chief reason for the steep drop it seems, can be explained by May’s presidential election when Socialist François Hollande ousted conservative Nicolas Sarkozy from the Elysée Palace.
Of the 52 leaders of French operations of US companies, 65 percent of respondents cited the election of a Socialist government as having a negative impact on attractiveness.
The US business leaders were also critical of the Socialist government’s economic policies, which include its controversial 75 percent tax rate on earnings above one million euros, According to 85 percent of respondents the policies have also had a negative or very negative impact on the attractiveness of France for foreign investors.
The poll has seemingly largely been ignored by France’s leftwing press but it has been used as ammunition by the country’s centre-right newspapers with Le Figaro acidly remarking that US investors had sent a “clear message” to Hollande.
Some 54 percent of those polled believed the financial outlook in their sector had deteriorated while 39 percent of the business leaders said they believed their headquarters in the United States had a negative perception of France, compared with 15 percent in 2011 and 9 percent in 2010.
The American Chamber of Commerce wants France to take action to improve the outlook for investors.
“What is important today is to know how France is going to react to showcase its strengths in innovation and competitiveness in order to attract new foreign investors,” said Marc-Andre Kamel, a member of the board of directors at the American Chamber of Commerce in Paris.
There was some good news for Hollande and his government though: 73 percent of the US business leaders said they were in favour of the government’s 20-billion-euro initiative that would lower their tax charges to employ workers.
(FRANCE 24 with wires)