Politics & economics

Introduction Accessing French Public Markets New Business Creations at Record Level in France Help for France’s SMEs - new measures announced The outlook for business in France in 2007-2008 An attractive Social and Tax system Record Levels of Foreign Direct Investment in 2007 Public Tenders in France France demographics

 

Help for France's SMEs: new measures announced

The French government recently unveiled measures in favour of small and medium-sized enterprises in France. The measures fall under three categories:

Financing: The 2005 Budget called for insurance companies to allocate 2% of life insurance funds to investments in unlisted SMEs. The government reiterated this objective and promised to audit life insurance investments to make sure the SME allocation was being respected.

In addition, the government will introduce legislation to allow and encourage a French version of SBICs (small business investment companies, common in the USA since the 1960s) to provide equity funding for SMEs. The target is to raise €2Bn on capital markets guaranteed by the state to invest in SMEs, used as venture and investment capital.

New Markets: Only some 100,000 French SMEs - or just 5% of the total - currently export. To promote exporting from French SMEs, the government will promote the “partenariat France” scheme. This scheme consists of introducing SMEs to larger companies who have strong export records so that the SME can “piggy-back”  in export markets. To date, only 35 large French companies have signed up to be a partner. Secondly, the government will examine ways to promote mergers between small companies to form medium-sized, export-ready companies. The target is to create 5,000 mid-sized companies capable of exporting.

Innovation: The government wishes to identify 2,000 high-potential SMEs that will receive help from “experts”. In particular:
• the government will offset some of the costs of web-masters to develop on-line sales for 1,000 SMEs this year,
• the first patent application will be free for 500 SMEs selected as high-tech SMEs,
• 500 grants will be awarded to companies employing students from top high-tech universities and schools who can introduce some new technology into the SME.