Will American investors shun France? This is what a survey carried out by the American Chamber of Commerce in France (AmCham) with the Bain & Company firm and published this Wednesday, February 28, suggests. The country’s attractiveness would deteriorate “for the second year in a row”, according to the report.
Despite “good news”, we cannot ignore “the warning signals for two years”: “We see the attractiveness of France eroding even more” than in 2022, to the point of reaching pre-Covid levels, noted Marc-André Kamel, vice-president of AmCham during a press presentation.
Administrative burden, taxation, labor costs…
After surveying 140 managers of subsidiaries of American companies, the Chamber of Commerce noted a clear reduction in the propensity of investors to recommend France to set up an entity. In the study, the morale of American investors in France is described as “mixed” in 2023.
According to the barometer, for example, as many American investors believe that the economic context in France has improved in 2023 (33%) as think that it has deteriorated (32%). Furthermore, only 22% of them see the French economy developing favorably in the coming years. They were 56% last year. Sufficient according to AmCham, to confirm the “increasing uncertainty since 2022”.
For Marc-André Kamel, the consequence of “certain historical irritants of France (which) are rising to the surface”. And the head of AmCham mentions: the cost of labor, the social climate, taxation, and even the administrative and regulatory complexity.
(Much) awaited reforms
Many business leaders would particularly regret the legislative delay, and would expect the French government to “quickly implement the latest reforms announced”, such as that on social contributions, the creation of residence permits for professions in shortage or even the elimination of the CVAE, postponed to 2027.
While calling to “stop the over-transposition of European standards into French law, AmCham France recommends that the French government achieve a “rapid formalization of the Simplication/Pacte II bill”, which raises “strong expectations among businesses “.
The implementation “as quickly as possible of all the provisions provided for by the green industry law” is also strongly awaited. In summary, “the ‘shock of simplification’, announced by Emmanuel Macron in 2021, is essential today more than ever,” believes the president of AmCham France.
Bercy at work
Although unsatisfactory, the results are not disastrous. Questioned on BFMTV, Marc-André Kamel notably recognizes a “very paradoxical” assessment. France remains, for example, “on the top step of the European attractiveness podium”. In addition, the study also welcomes the country’s “dynamism” despite geopolitical tensions, an energy crisis and high inflation in 2023.
Furthermore, nearly 7 out of 10 American leaders say they have welcomed the “reforms put in place since the re-election of Emmanuel Macron”. According to them, the President of the Republic elected for the first time in 2017 promoted a “pro-business impulse in France”, notes the report. Recently, the Minister of the Economy Bruno Le Maire announced a bill to strengthen the financial attractiveness of France. The text is expected by spring.