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Partnerships on the horizon
By Christian Benoit (China Daily)
Updated: 2004-10-09 11:43

France and China have a strong relationship on which to build. China has the largest French community in Asia - about 11,000 French people now live in China.

According to Chinese sources, French foreign direct investment (FDI) in China amounted to US$6.1 billion in 2003, ranking France 10th among overseas investors. This represented 15 per cent of the total European investment in China.

With 1.2 per cent of its FDI in China, France ranks behind the United Kingdom (2.4 per cent) and Germany (1.8 per cent). French FDI registered a major increase after 1995, from 115 to the present 300 million francs per year.

These investments are mainly made by major industrial groups and are sometimes linked to very large infrastructure projects like subways, nuclear power stations and water treatment plants.

Nevertheless, French FDI tends to diversify in type and size and the total number of French companies exceeds 1,000, employing more than 150,000 people in China.

Among the most recent ones are Michelin which took the control of Shanghai Tire and Rubber Corporation with US$150 million, Alcatel with Shanghai Bell, Veolia in Pudong and a new factory for Lafarge.

French products

French products - fashion and accessories, perfume, champagne, wine and spirits, designer goods, and zippy French cars are highly regarded in China.

It is also true for more industrial products like airplanes, transport technology and civil engineering.

France is the world's fourth largest economic power in terms of gross domestic product (GDP).

The country's assets are varied and include its transport and telecommunications sectors, agro-food and pharmaceutical industries, along with banking, insurance, tourism and traditional luxury products like leather goods and ready-to-wear fashion.

In 2003 France was the world's fourth largest exporter of goods, mainly durables, and ranked second in services and agriculture especially cereals and agro-food.

It is the leading producer and exporter of farm products in Europe.

France carries out 62 per cent of its trade with its European Union partners and 50 per cent within the Euro zone.

It ranks fourth internationally for direct inward investment.

Foreign investors appreciate the skills of the French workforce, the advanced level of research, the mastery of high technology, the stable currency and control of production costs.

France's GDP stood at 1,551 billion euros (US$1,861 billion) last year, a growth of 0.5 per cent, which is expected to grow 2.5 per cent this year.

France's major industries

In the aeronautics and space industries, France's Airliner with over 100 seats is on equal footing with Boeing and Ariane handles 60 per cent of Western civil satellite launchings.

Agribusiness is France's leading industry and France is the number one exporter of processed products, holding 10 per cent of the world market.

The building and civil engineering industries are not only the foremost employers in France but world leaders as well.

The chemical industries in France are a major sector with a top rank in the world economic landscape.

In the field of energy, France hosts 58 nuclear facilities which all use pressurized water reactors.

In environmental industries, France does a brisk business on every environmental market, from water treatment systems to the development of renewable energies.

France holds nearly half the market shares in luxury and fashion industries, making the country number one in the luxury goods industries.

In the health and pharmaceutical industries, Aventis, the outcome of a merger between giants Rhone-Poulenc and Hoechst, is the world's new leader in life sciences.

In the railway and automotive industry, the TGV (high speed train) runs at a speed of 512.2 kilometres per hour, a world record forged by French expertise.

Ideal partners

China and France both wish to increase significantly the presence of French companies in China, one of the largest and fastest-growing markets of the 21st century.

France can offer unique technologies in all fields, and has a long tradition of co-operation and trans-national projects inside and outside Europe.

They are the partners Chinese companies are looking for.

Christian Benoit is the commercial counselor of the French Embassy in China

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