France is by large one of the most suitable places for business to thrive and the sustainability of the enterprises is high. France is one of the largest countries in Western Europe, and most significantly, it is the fifth economic power. Moreover, there is diversity in terms of social and economic practices. Additionally, the political environment in the region is favorable for a majority of the investors and business people in the region. In light of this, therefore, this paper seeks to examine the country’s background and relevant factors that can help to understand France as a place for trade. Consequently, this will entail the prospects for trading partners as well as the participation in cross-national corporations and agreements. It will also focus on the major trends which are affecting France standing in global business and environment currently. Thus this will help to create a clear picture of realistic expectations while doing business in France.
Background on France
After the cold economic climate after 2008, France has faced several challenges in maintaining the viability of the region’s social models. The unemployment levels click around the 10% mark, and this brings a clash among many people who are a desire for markets reforms and those who hold on to the traditional interests. Consequently, for a long period of time, there has the traditional interests have shaped as well as influenced many approaches and internal policies developed to guide businesses in France (Trouille, 2013) .
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Nonetheless, there are two elements integrated by France which play a significant role in the approach to business adopted by the France. Subsequently, this two elements makes France stand out in relation to other industrialized economies globally. They entail government’s role as well as the specific type of education. Basically, after the Second World War, the government of France was active in fostering establishments of national champions companies in the counties. The companies were intended to compete with other companies at the global levels. Moreover, the government was involved in making policies which created a good working environment for companies in France. Most importantly, the interventions which were adopted by France’ government are widely acceptable by mainstreamed business (Trouille, 2013) .
Additionally, the France developed an education system which has aided the level of cooperation between the industries in France and the government. The educational systems foster brightest students through an elite school system referred to as the Grandes Ecoles. Consequently, graduates in this system are absorbed by large commercial organizations as well as the civil services (Trouille, 2013) . Thus this has enabled France to maintain its position globally as among the leading in relation to aeronautics, banking and finance, and also other hi-tech fields. The two pillars, therefore, act as a crucial factor that boosts businesses in France for any international business person in the country.
Cultural Environments
For any business person seeking t do business in France, the first thing they have to acknowledge is the different cultural environment in France. Subsequently, in order to be successful in doing business in France, one ought to develop a close personal relationship with the French people to be able to come to terms with the cultural requirements (Banutu-Gomez, 2014) .
To begin with, French people have high regards for power distance, that is, before a decision is arrived at, it has to be carefully deliberated upon, and people have to give their opinion regarding the matter (Banutu-Gomez, 2014) . Thus, this exalts hierarchy in respects to decisions being made as power is centralized. Therefore, individuals conducting business need to understand that the hierarchy systems are important and inequalities are predominant.
Secondly, individualism is highly appraised in respect to the independence of the employees or other cases people in society (Banutu-Gomez, 2014) . In France, people work on an individual basis rather than working communally. Most of the times, individual work alone which results to a lot of competitions in a company among the employees. Individualism is fostered in the region as people only look after themselves as well as their direct families.
Thirdly, masculinity and femininity in France are also key factors that are engraved in their culture. Women seek t live quality life, while men aspire to be the best. There exist some levels of inequality where women are most affected, for example, in terms of pay; they are paid less money as compared to men (Banutu-Gomez, 2014) . However, in other cases, equal opportunities exist for both men and women such as job opportunities. A majority of people in France are long-term orientated and like to take risks.
The political, legal and economic environment
The French economy is considered to be highly diverse, with strong legal institutions which strengthen property rights (Beck, Demirguc-Kunt, & Levine, 2001) . Additionally, it has an efficient regulatory framework which acts as a key facilitator of the entrepreneurship activities in the country. The government fosters transparency and accountability and thus this enables the business to thrive well in the region.
Foreign Direct Investments
Basically, France is considered to be among the world’s most Foreign Direct Investment’s attractive countries. Currently, according to statistics, it is ranked in the 11th position globally. Subsequently, this can be attributed to a number of factors. To begin with, France signed a bilateral investment convention to protect the foreign investments. Secondly, the foreign companies have the privilege of enjoying similar governmental aid as any indigenous company in France. Moreover, France has a well-established industrial base, substantial agricultural resources as well as efficient infrastructures all which aid in thriving foreign businesses (Razin & Sadka, 2007).
Business Ethics
The business ethical codes in France are derived from a variety of traditions other sources. A large part of the legal systems in France is drawn from the Human Rights declarations. Therefore, ethical codes in business are considered to be vital as going against them contravenes the freedoms and rights of other people. Subsequently, the ethics are mainly derived from the French constitutions. A business requires being registered and not engage in any fraud, larceny or contravening the labour laws. It also has to respect the rights and freedoms of the employees (Razin & Sadka, 2007).
Corruption in France
Consequently, France is ranked among the countries which are known to have low tolerance with respect to corruption. It is considered to be among the first 25 countries worldwide that are less corrupted. The country maintains laws and regulations which impose penalties to reduce the level of corruption. The judicial bodies are also vigilant in ensuring that it successfully convicts victims of corruptions both in businesses and public officials. The country adopted the OECD Anti-bribery Convention in 2000 through amendments done on Criminal Code in Article 435-3.
Geography Location of France
The geographical location France places it at two salient advantages. To begin with, due to its outstanding communication network, France is regarded as being at a crossroad at the European Union’s heart. Most significantly, it is linked to the East by a wide array of industries and urban centers of Germany. Subsequently, on the other hand, it is within an easy reach by the United Kingdom. Moreover, it forms a Mediterranean arc which runs from Central Italy to Catalonia. Additionally, the French Coastline provides easy access to the country through the sea to Africa, America, and Northern Europe through the Mediterranean and the North Sea which are often busy waterways.
Prospects as a Trading Partner
Government Policies on International Trade
Basically, the French government allows for the reduced trading barriers and few restrictions which enable the government to open up to other European countries. The trade policies are mainly governed by the International Chamber of Commerce. They promote investments and trade in the region. Moreover, they ensure that there is a free flow of capital.
Direction and terms of trade
The term of trade means the ratio between the indexes of exports with that of the index of import prices. The France terms of trades have taken on a positive direction with an increase of 114,67 index points in September 2016 . The statistics were at 114.34 in August 2016 hence there is a significant increase. This means that the country is able can afford to purchase more imports with the revenue it gets from its exports (Organisation for Economic Co-operation and Development, 2016).
Participation in Cross-National Cooperation and Agreements
France has been at the forefront in participating at cross-national cooperation’s and agreements. One such agreement that France has formed is a bilateral relationship with Australia. Consequently, this allows for close working relations among the citizens of the two countries. Consequently, France has also joined strong regional trading blocs such as the European Union. The European Union is considered to be one of the largest regional economic group (Organisation for Economic Co-operation and Development, 2016). The European Union begun as a free trade agreement and then became a customs union. In this, France can conduct business with minimal trade barriers as well as well as restrictions in relation to trading with the members of the European Union. To a large extent, this has enabled France to trade with a large group if people.
Additionally, France has engaged in other Pacific agreements, as it has direct economic interests in the regions. Consequently, it has regions such as the New Caledonia, Wallin, Funtana as well as the French Polynesia which are along the pacific lane. Thus French is enrolled as a member of the Pacific Community. Moreover, since 1989, France has continued to be the dialogue partner in respect to Pacific Island Forums (Trouille, 2013) . Moreover, France, alongside other European Union countries have signed agreements and are members of the World Trade Organization.
Major Trends And Events Affecting Its Standing In The Global Business Environment
Sluggish Growth
According to statistics, the France domestic products are predicted to rise at a slower pace to around 1.3% during the year 2016. One major attribute to this slow rate is the fiscal pressure which is as a result of the government at the local, regional and national level operating on a strict budget. With this slow growth, France will face a challenge competing with others in the global environment.
High Unemployment Rates
Consequently, statistics in the year 2015 suggested that the French unemployment rate was at 10.6%. The youth unemployment rate is considered to be 24.7% in 2015 which reflects the high number of unemployment of the productive part of the population. Thus with a high number of unemployment, a lot of people cannot participate in wealth generation which poses a challenge to investments in the country making it challenging to compete globally.
Conclusion
In conclusion, France is considered to be one of the best places upon which foreigners can make successes in investing. Subsequently, the legal frameworks and work ethics developed are attributing factors for this. Moreover, the government has put several other measures to ensure that foreign companies enjoy equal rights as the other companies in the region. Additionally, other factors such as its geographical positions and culture act as major contributors to the success of business in the region. The governments have also partnered with other regional blocks which also aids in ensuring that there is a success in the business.
References
Banutu-Gomez, M. (2014). The Role of Culture, Language, and Ethics in Global Business. European Scientific Journal, Retrieved from https://login.proxy078.nclive.org/login?url=http://search.proquest.com/docview/1672619 646?accountid=11099
Beck, T., Demirguc-Kunt, A., & Levine, R. (2001). Legal theories of financial development. Oxford Review of Economic Policy, 17 (4), 483-501. Retrieved from https://login.proxy078.nclive.org/login?url=http://search.proquest.com/docview/2029364 74?accountid=11099
Organisation for Economic Co-operation and Development, (2016). International trade - Terms of trade - OECD Data . The OECD . Retrieved 4 December 2016, from https://data.oecd.org/trade/terms-of-trade.htm
Razin, A. & Sadka, E. (2007). Foreign direct investment (1st Ed.). Princeton, N.J.: Princeton University Press.
Trouille, J. (2013). Economic And Industrial Cooperation Between France And Germany: Assessment and future prospects. German Politics and Society, 31 (1), 1-23. Retrieved from https://login.proxy078.nclive.org/login?url=http://search.proquest.com/docview/1370140 885? Accounted=11099
