Business and Economics
French business was long characterized by a fairly slow industrialization and economic development compared to the other Western European countries. Until the Second World War, agriculture was the largest industry. Since then, France has quickly become a country based mainly on service and industry. Especially during the 1960s, the economic growth rate was very high; industrial production increased rapidly while the agricultural sector was strongly de-populated.
Today, France is after Germany’s leading industrial nation in Western Europe. The country has a very varied industry, which employs 18 percent of the employed. However, industrial employment has never had the same significance as it has in, for example, the UK and Germany. The millions who left agriculture after World War II have largely gone to employment in the service business, which is now the dominant economic sector. The service sector employs 80 percent of the employed. Compared to most of Western Europe, retail and hotel and restaurant operations are very significant. In large parts of the country, the tourism industry has replaced agriculture as the main industry.
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Despite extensive privatization, France still has a large state ownership in the business sector. Several major privatizations have been met with extensive protests during the 00s and in some cases stopped.
The business sector shows remarkable regional differences in terms of industry distribution, the relative importance of agriculture, the value of service sector production and wage and price levels. The Paris region (Île-de-France) accounts for just over a quarter of the country’s total production. Per capita GDP here is almost twice as high as in the least developed industrial regions along the west coast (Brittany and Poitou-Charentes), in central France (Limousin and Auvergne) and in the south (Languedoc – Roussillon).
About 53 percent of the country’s area is usable land. Agriculture, along with fishing and forestry, employs 2 percent of the workforce. Agriculture differs a great deal across the country. Roughly speaking, eight different agricultural landscapes can be distinguished:
1) The open landscape of the Paris Basin with large units focused on intensive grain production;
2) the eastern parts with more forest and smaller, intensively used fields;
3) pasture-dominated areas mainly focused on livestock breeding and dairy production (Brittany, Normandy and the areas south of Loire);
4) forest landscape (an ancient cultural landscape with small, irregular fields and pastures, often bounded and fenced with vegetation) with medium-intensive agriculture and pasture with steak breeding (the areas north of the Central Massif and Jura Mountains);
5) Midi (Mediterranean) with largely irrigated cultivation of fruits, vegetables, flowers and rice (Camargue);
6) the Rand Mountains (Jura, the Alps and the Pyrenees) with predominantly livestock management and some agriculture in the valleys;
7) The central massif with rye and potato cultivation and breeding of sheep and goats;
8) Aquitaine, which forms a transition zone between different climates and has a very varied agriculture.
The specialized wine growing districts are located in or between these areas, in the north mainly in connection with the river valleys. See further French wines.
In almost all agricultural products, France is one of Europe’s largest producers. In total, the most important products are cereals, which are grown on just over half the arable land, and animal production, mainly meat and dairy products. Feed plants are grown on a quarter of the field. During the post-war period, agriculture has undergone a strong rationalization, which is actively supported by the state. As in Sweden, the goal has been for farmers to have a standard comparable to that of industrial workers. To achieve this, the focus on high-priced goods has been increasingly emphasized; animal production has increased dramatically, and the arable land has decreased by 1/7. The use units have become larger; the average size is over 25 hectares, but still almost a third of the farms are under 10 hectares. Operations have been mechanized and streamlined with, among other things, a radical increase in the use of artificial fertilizers. Agricultural employment has decreased by 80 percent. France is one of the world’s leading exporters of wheat, sugar, dairy products and wine. Imports consist mainly of rice, feed and fruit.
EU agricultural policy has benefited the export-oriented part of French agriculture, which has benefited from export subsidies. On the other hand, it has disadvantaged the more domestic market-oriented parts such as fruit and vegetable cultivation in Midi and Western France, which have been subject to increased competition from the Netherlands, Italy, Spain and Portugal.
About 29 percent of the country’s area is covered by forest. The most wooded areas are found in the country’s eastern parts (Champagne-Ardenne and Lorraine) and in the southwest, with the pine-planted sandy shores of Les Landes along the Atlantic coast. In addition, there are some larger forest areas around Paris, for example. Compiègne and Fontainebleau forests. Also south of the Loire Valley (Sologne), at the edge of the Central Massif and in Provence are forest areas. However, many parts of the country are fairly wooded, especially the northwestern parts, such as Normandy and Brittany. Today’s French forests are largely a product of a deliberate forest planting since the mid-1800s. The forest area has increased by about 50 percent in the last fifty years.
However, forests are, to say the least, varied, depending partly on the climate and soil, partly on the management, or lack thereof. Less than half of the forest area can be counted as truly productive forest land. Many woodlands are not used for anything other than hunting or recreation, others – especially in the south – mainly consist of pine forests that can only be used as fuel. The forest stock comprises 58 percent of deciduous forest and 27 percent of coniferous forest. Otherwise there are mixed forests, smaller groves and poplar stocks. Especially in Provence there are major problems with forest fires, which annually destroy tens of thousands of hectares of forest. The forest industry is not one of France’s more important branches of industry. However, the production of sawn timber is significant, while wood and pulp are among the country’s traditional import goods. About half of the wood consumption is imported.
France is one of Europe’s largest fishing nations. The French fishing fleet’s total catch in 2010 was approximately 426,000 tonnes, of which approximately 338,000 tonnes were fish (mainly albacora, sardine, bonit and hake), 62,000 tonnes of molluscs (snails, mussels and squid) and approximately 18,000 tonnes of crustaceans. In the same year, approximately 224,000 tonnes of seafood were grown, mainly Japanese giant oysters, mussels and rainbows. The cultivation of oysters is of great economic importance.
By far the largest proportion of catches are recorded in the Northeast Atlantic and the North Sea. The main fishing ports are in Brittany (Le Guilvinec, Concarneau and Lorient) and on the canal coast (Boulogne-sur-Mer, Caen, Cherbourg and Saint-Malo). The Mediterranean fishery is comparatively of little importance. France is one of the world’s largest fish importers.
Over the past twenty years, France’s mineral sector has changed from a combination of production and processing to almost exclusively processing. The country has quite varied mineral resources and the mineral sector has been significant but has lost weight in recent years. Nowadays, domestic production of mineral raw materials and metals is limited and the processing industry relies heavily on imports.
France is one of the major producers of diatomite and plaster (Taverny), pig iron and crude steel (among others Lorraine and Dunquerque), talc (Pyrenees) and rock salt (Vosges, Jurassic mountains and Pyrenees). There is also uranium ore in Limousin, but the industry is dependent on imports from Canada and Niger, for example, although the processing is done exclusively in France.
The most important assets have traditionally been coal and iron ore. The main coal areas were in the North and Lorraine region, but production has ceased. Lorraine has one of Europe’s foremost iron ore fields with phosphorous low-grade (about 30 percent iron content) mined ore, which has been quite shallow. These assets previously made France one of the world’s foremost iron ore exporters and steel producers, but during the late 1900s production was dramatically reduced.
Oil is mainly extracted in the Paris basin and gas around Lacq in Aquitaine, which also has some oil deposits.
The total energy consumption per capita is at a medium level compared to the rest of Europe. The distribution between different energy sources is, for the EU countries, quite unique. Nuclear energy expansion, Europe’s most extensive, has meant that this source of energy accounts for just under 80 percent of electricity production and covers just over 40 percent of total energy consumption (2009). The coal, which previously accounted for a significant part of electricity production, accounts for 4 percent of energy supply, oil for just over 30 percent and natural gas for about 15 percent. In 2011, the 58 nuclear reactors of the French nuclear power plants accounted for 17 percent of world production. France also has the continent’s largest water energy resources and, together with other renewable energy sources, accounts for about 8 percent of energy production with the goal of reaching 23 percent by 2020.
Of the consumption, private use (housing) and transport account for just under 30 percent and the transport sector for just over 15 percent (2009).
The state owns most of the energy sector and has actively worked to build the electricity generation industry into one of the country’s leading industrial branches. Unlike most other countries, the large nuclear program has received very little opposition and debate. Nuclear power plants have been located mainly on the periphery of the country, along the coasts and close to the borders of neighboring countries.
France is one of the world’s leading industrialized countries, with a very varied production characterized by an increasing emphasis on workshop products. The most important industries are the food industry, the electrical industry and the transport industry. The manufacture of clothing and textile products, paper products, metal products and steel has traditionally been a significant part of the country’s industry, but during the 00s these industries have decreased in importance. The pharmaceutical, aerospace and electronics industries, on the other hand, have had stable growth. Less significant are traditional but still vibrant industries such as perfume manufacturing, fashion (haute couture), glass and rubber manufacturing.
The French industry has traditionally been dominated by small businesses, but the importance of large companies has gradually increased. The last decades have been characterized by extensive structural rationalization with the reduction of traditionally important industries such as the iron and steel industry, the textile industry and the shipbuilding industry. Technically advanced industries have expanded. This restructuring has been actively supported by the state, which, through orders and export subsidies, has favored the development of certain industries, including the energy, telecommunications and transport sectors. These are areas where the French industry claims relatively well. The private sector dominates, but state ownership is more widespread than in any of the other major industrial nations.
Like industry in general, the industry shows significant regional differences. The most industrialized regions are around Paris, in the northeast and in the eastern central parts of the country. Île-de-France accounts for about 20 percent of the total manufacturing value of the industry and has a very high proportion of the most advanced, research-oriented industry. In addition to the Paris area, there is the most varied industry in Rhône-Alpes. By contrast, in the western, central and southern parts, except in the Loire Valley and around major cities such as Marseille and Bordeaux, there is a comparatively small and undiversified industry, often dominated by the food industry. Here, wages are also often lower. Brittany, Corsica and the Mediterranean coast are the regions where the industry is least significant.
Previously, many industries were geographically concentrated and made their mark on different regions and cities. These include Nord Pas-de-Calais (textile and steel), Lorraine (steel), Limoges (ceramics), Besançon (watches), Clermont-Ferrand (rubber) and Nantes (shipbuilding). Due to stagnation and cuts in such traditional industrial branches, this move has been faded.
The government has since the 1960s tried to remedy the regional imbalance through an ambitious localization policy. The result is that the industrial dominance of the Paris region has decreased somewhat and that some industrial growth centers (for example, Rennes, Grenoble and Toulouse) with relatively varied industry have been created, but this has hardly changed the basic balance problems. Increasing imports of minerals and energy raw materials have also led to strong industrial expansion in some coastal areas, such as Fos in the Rhône Delta.
France is Europe’s second-largest total exporter and its third-largest importer, yet foreign trade is not very extensive in terms of GDP. There is usually a certain deficit in the trade balance and a positive service balance. Workshop products account for nearly 2/5 of exports, and food and chemical products account for 15 percent each. Of the imports, 36 percent consists of workshop products, 15 percent of chemical products and 13 percent of raw materials (of which crude oil 6 percent). Most of the trade is done with the EU countries. The most important trading partners are Germany, Belgium, Spain and Italy. Outside the EU, the US is most important.
Tourism and gastronomy
For many years, France has been the world’s largest tourist country in terms of foreign visitors; annually, the country is visited by about 80 million foreign visitors. According to Countryaah, most come from neighboring countries within the EU: the UK (15%), Germany (13%), Italy (8%), the Netherlands (7%) and Spain (6%). About 700,000 visitors a year come from Sweden.
Tourism, in the sense of people traveling for pleasure to rest or view places of interest, did not gain momentum in France until the 17th and 18th centuries; before that they traveled to Italy. Now France became a stronghold of art and culture and French the language that counted among the educated. The revolution and its aftermath caused the number of travelers to decline, but the development of literature and painting during the 1800s and early 1900s led the industry to regain momentum, now in combination with sun worshipers who sought the picturesque Mediterranean coast.
France offers memorials from 2000 years of European high culture, paired with a regional pride and investment in regional museums that also show the history and culture of the common people. In France, all tastes can be satisfied: food, wine, nature, winter sports, sea, art, architecture, theater, music, fashion; the supply is huge. Good communications, a modern road network and an old, expanded hotel and restaurant industry provide the best conditions.
Since 1950, a state-initiated, intensive effort has been underway to renovate and preserve historic buildings and to make as much access as possible to museums; The national museums with some of the world’s foremost art collections can be found in the capital, but every small town in the provinces has its own museums and conservation plans. In addition to Paris, the Mediterranean coast and Brittany-Normandy, the south-western Alps, the Loire Valley and Alsace are the areas that attract the largest number of tourists. However, there is a tendency to spread outside the traditional tourist areas as interest in genuine culture and nature experiences increases among today’s travelers. During the 00s, newer attractions such as Disneyland Paris and Parc Astérix have also attracted many visitors.