France offers vigorous environment for business investors13.10.2014
Although France does not have a double digit growth rate, the country still provides a vigorous environment to do business. According to the Ernst & Young’s survey published in 2012, France was the number one destination for foreign investment in certain industries, offering investors major market potential and a place to profit and thrive.
Let’s focus on 3 of them:
- Renewable energies
- Infrastructure projects
The environment sector is massive. Mid-2014, France spends up to €47 billion in environmental protection. Revenues in environmental-friendly activities in France are about €85 billion, with a growth of 5.6% in 2014 compared to 2013. The added value provided by companies in this sector is established at €32 billion (which is 1.6% of the French GDP). Major sectors such as biotechnologies, renewable energies, sustainable transport and energies are growing fast.
In the energy sector for instance, Smart Grids are more and more attractive for companies who are willing to make savings on their operating costs. Young innovative company Qualisteo, specialized in detailed electricity consumption measurement and management systems, raised €2 million in 2014 for financing commercial deployment support of its activities. Demeter Partners and Emertec Gestion were responsable for the investment:
Mr Jean-Philippe Gendre, Investment Director at Emertec Gestion: “The relevance of Qualisteo’s technical offer, the first installations on complex industrial sites and the demonstration of significant energy savings for customers together with the director’s excellent market knowledge convinced us. Our financial support will allow Qualisteo to position itself firstly as the leader in France, then as one of the world leaders for energy efficiency optimisation solutions for industrial or service buildings”.
“In a smart grid sector which is teeming with initiatives, Qualisteo’s technological difference combined with a pragmatic B-to-B approach has enabled Qualisteo to put together a coherent, effective and low-cost offer on well-targeted market segments. This financing phase will now provide the company with a sales force to handle the rapid development of the market and customer expectations”, comments Mr Benjamin Wainstain, Investment Director at Demeter Partners.
In fact, many French companies are going green through sustainable development like energy savings. GreenYellow, subsidiary of the Casino Group who cut the energy bill of its supermarkets by focusing on renewable energies such as solar panels and the improvement of the working environment by several green innovations such as gardens on roofs and natural light in the working environment is another example.
France has adopted impressive energy objectives for the future: by 2020, 20% of the energy consumption needs to come from renewable sources. In the context of this goal, the French government launched 2 offshore wind projects, located in Normandy and Brittany, developed by French, Spanish and Danish companies. These projects account for 3000 MW. In addition there’s also a hydraulic energy farm project active, located in a strong marine current called “Le Raz Blanchard”. This project is close to Cherbourg and Aurigny Island and is starting to be developed by GDF Suez – Voight Hydro; representing 50% of the French potential for hydraulic energy.
“Le Grand Paris” is currently one of the most important infrastructure projects in France. It embraces sustainable development of the economy and employment in the region to maintain and strengthen the position of an investment of “Ile-de-France” among the most attractive cities at international level. This project represents €26 billion in 15 years; more than 70.000 accommodations will be built each year, with 57 new train stations and more than 300 tenders. The first step to develop this project is the creation of the “Grand Paris Express”, a train and metro network which will connect suburbs with each other and with Paris. This represents a construction of 200 kilometers of rails.
By 2020-2025, Le Grand Paris will include several business centers, with la Défense as the hotspot, a Biotech valley located in the south of Paris and several innovative clusters in the north. All these clusters will be linked together thanks to the Grand Paris Express.
Paris wants to become more competitive with its neighbor’s capitals with a maritime coastline. The harbor of Le Havre and Rouen therefore will become the gate of Paris and there’s the intention to increase the transport by waterways (2012: 84% by road / 16% by waterway. Plans: 75% by road / 25% by waterway). This will decrease the ecological footprint for logistics companies and for consumers. If Antwerp is actually the port of Paris for 60% of flows of goods, the annual traffic growth for Le Havre and Rouen harbors should increase from 1.9 million to 4.2 million of TEU in the next 10 years, creating hinterlands and development of multimodal networks.
Another ambitious project is the canal Seine North; a project which connects Le Havre and Paris with Dunkerque and the Benelux, passing through the department of l’Oise and Pas de Calais. This project will also create hinterlands, cereals docks and industrial plants, cutting transport costs from 15% to 50% depending on the network. This implies that 4.5 billion of tons of goods per kilometer will pass from road to water transport saving also 280.000 tons of CO2.
These projects are only a glance of the numerous business opportunities which exist in France. If you would like to know more about what France can offer to your company, please feel free to contact our office in Paris.