AmCham-Bain Barometer
21st edition AmCham-Bain Barometer Satisfaction of American investors in France
Table of contents I Foreword 4 2 21 years of France’s attractiveness for American 6 investors in France 3 Barometer 2021 on the satisfaction of American 8 investors in France 6 figures to remember 8 Projection: U.S. investors’ outlook in France 10 | Medium-term outlook 11 | Job creation perspectives 11 | France in Europe 12 Perception : France and its regions as seen by American investors 13 | France’s NPS® 14 | Assets and priorities to attract investment in France 15 | Innovation and CSR ecosystems 15 | Events (excluding Covid) that made 2020 17 | Regions’ attractiveness 18 Focus: Impact of the Covid-19 20 4 AmCham’s recommendations to strengthen France’s 23 attractiveness 5 Methodology and profile of US investors interviewed 26 6 About AmCham and Bain & Company 27
Foreword th Last year we published the 20 edition of 2008-2009 crisis, we must remember that the The country seems adequately positioned to Finally, in these uncertain times, the fear of the our Barometer on France’s attractiveness for NPS had fallen to an historically low level of perform well in Europe. This year, American “French paradox” is making a come back: a American investors, which showed record -74%, losing 46 points in three years. investors praise government’s support country that absorbs shocks better than others, results and high satisfaction despite some level This global crisis also has the effect of an measures and recovery plan. They are 96% to but that might be slower to bounce-back when of uncertainties regarding the social climate. increasingly sizeable polarization of opinions. believe that support measures for businesses the whole world will be starting up again. At that time, nothing could predict that we While about 40% of American investors in France were as competitive as in other In the light of the global crisis, which is laying would experience such an extraordinary year. anticipate a positive evolution of the economic European countries, with 54% even believing out the foundations for the world of tomorrow, The 2021 Barometer primarily reflects investors’ context in France in the next 2-3 years, only that they have been more competitive than American investors seem to be holding their uncertainty in a bewildering global context, 2 points less than last year, 23% of them, 12 elsewhere in Europe. breath when looking at this unpredictable more than a lack of attractiveness for France. points more than in 2019, anticipate a negative In this context, they anticipate a relatively quick French trajectory. They seem torn between the However, these uncertainties exacerbate the evolution. return to normal as 77% of them think their fear of seeing the crisis push France back into country’s shortcomings. Beyond the economic situation, which is company will take 2 years or less to recover its “old demons” and the wave of hope created Unsurprisingly, this “black swan” event inevitably complicated, it is above all France’s and reach an economic activity equivalent to by the new innovation-driven and forward destabilizes the immutable equilibrium and historical and structural obstacles or weakness the pre- Covid crisis level. looking spirits of the country - encourages a slightly more cautious outlook that American investors are pointing out to Another reason for hope: France is still This AmCham Bain 2021 Barometer should among the community of American investors explain their decline in optimism. One of perceived as an attractive country for undoubtedly lead France to seize this crisis surveyed. In particular regarding employment, the weak signals we had identified in our innovation, with 86% of the American investors as an opportunity to correct its historical this year’s results shows the repercussions of barometer over the past few years is now at the surveyed perceiving its innovation ecosystem weaknesses , and to seize the positive the global crisis: 28% of American investors forefront of this years’ results: ranked as the 5th positively or very positively, praising the prospects offered by this “black swan event” believe that their workforce will decrease in decisive criterion for investment decisions by workforce qualification, government support for the country’s future. France has all the levers the next 2-3 years, 21 points more than last American companies in 2019, the social climate for the new economy and IT infrastructures. in hand to make it happen and AmCham will year, for only 27% who think they will increase -unanimously- becomes the first criterion in It will be interesting to closely monitor support France in its efforts to become more (51% last year). 2020. 54% even consider it as an obstacle to changes in opinion in the coming months, attractive to transatlantic investment. This caution materializes in a slight erosion their investments in France, in comparison and to maintain a high level of attention. The of the attractiveness of France for their with other European countries. Also, the multiplicity of Covid variants, the prospects investment decisions. However, the underlying legal framework surrounding redundancies of new lockdowns in the long term, the global uncertainties should bring us to mitigate and their complexity are still perceived as a uncertainties related to a lasting drop in Covid weakness despite the reforms undertaken Bijan Eghbal this erosion. by the government at the beginning of the cases, force companies to be in permanent Partner at DLA Piper France’s NPS as a location for business mandate; more and more people are criticizing crisis management mode and reduce President of AmCham France investments slightly fells to -20% in 2020, the complexity of procedures (73%) and their prospects in the short and medium term. The costs (80%). sustainability of the “whatever it costs” strategy Marc-André Kamel 8 points lower than in 2019. This figure defended by President Macron to support the Partner and Director at Bain & Company can easily be explained by the economic Despite these points of attention, the pandemic economy is questioned: 70% of investors say Vice-President of AmCham France downturn following the Covid-19 crisis. But has only slightly tempered the optimism of they are worried, or very worried about the the unprecedented scale of the shock caused American investors regarding the attractiveness level of public debt, and its impact on taxation by the global pandemic seems relatively well of France. in the years to come. absorbed in the light of past crises: for example, between 2011 and 2014, or following the st st 4 21 edition AmCham-Bain Barometer 21 edition AmCham-Bain Barometer 5
21 years of France’s attractiveness for American investors First annual 45– of companies did France faces an §eaders of French 8– of investors consider Folloing 2 ears of global Strong decrease of the satisfaction of US barometer on France's not create obs after increasingl global subsidiaries of US that the election of ”inancial crisis, investors are investors in France folloing François attractiveness for the enactment of the competition, companies fear the ‡resident Saro¤ ill more optimistic regarding ¥ollande’s election and term US investors bill setting oring especiall from negative impact from have a positive impact the economic situation time at 5 hoursªee ƒastern ƒurope the deterioration of on foreign investment n 2012, ¦85– of the n 2015, France remains not so ƒmmanuel ’acron’s election 1,250 US companies and …sia Franco“…merican in France ¥oever, France's surveed e„ecutives attractive compared to Uœ, as ‡resident of France drives are established in …merican companies relations attractiveness is don thin that the Šerman and the ‰etherlands‹ US investors’ optimism up France, providing perceive the French France historical ith onl 4– €2010‚ and ta„ation and he economic and social 458,000 direct and ecosstem as drabacs remain ‘nl 0– of US Œollapse of the satisfaction 5– €2011‚ of investors regulation measures situation, labor ©uali”ication 1,50,000 indirect favorable to ne the same« a rigid investors predict an of US investors regarding considering it a ‘good’ announced ill and cost, as ell as ta„ation, … troubled social and economic obs technologies organi¤ation of labor improvement of the the evolution of the or ‘e„cellent’ destination‹ penali¤e France’s remain the most important climate at the global, ƒuropean and an unfavorable economic conte„t economic conte„t he ere up to – attractiveness criteria for investment and French scales slos don ”iscal polic in 200• decisions investors’ optimism SATISFACTION OF AMERICAN INVESTORS IN FRANCE * 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 he “Aubry” la nauguration Jacques Chirac he reform of Œlosure of the Rejection of —emonstration Nicolas —eath of the France oins Stries against a France taes ƒlection of —emonstrations ncrease of the Terror attacs Nice terror ƒlection of he “Gilets —eath of he government sets the legal of the ins the civil servant's last French the ƒuropean against the CPE Sarkozy’s last ™™ "Poilu" NATO integrated pension sstem on the role of François in favor and VAT in France in France attacks on Emmanuel Jaunes” Jacques Chirac announces a oring time at emploment second round pension sstem coal mine in Œonstitution b election ”ighter command reform beteen G8 rotating Hollande as against same“se„ €from 1•‹– to ˆastille —a Macron movement series of 5 hours a ee bonus €ended of ‡residential trigers heav ’oselle referendum in September and ‡residenc ‡resident marriage bill 20– and from Œreation of the poisons the Notre-Dame measures to ”ight in 2015‚ elections stries‹ France France accounts ‘ctober 2010 Ž– to 10–‚ CICE and removal ¦50 taxes social climate de Paris in the pandemic at against e„treme Œontribution Smoking ban for more than 2 Dominique “’ enem is ƒntrepreneurs of the “ta„ on the created since for long ”lames ¨hatever cost¨‹ ƒnd of right candidate period is ˆegining of in public places million web users Strauss-Kahn is ”inance” protest and high“income 2010 for • he countr military service e„tended to riots in the arrested in ‰žŒ ncrease of constitute the orers” removed adapts to Crash of the 40 ears, up French suburbs Unemploment ban charges “pigeons ©uarantine and Œoncorde, that from Ž,5 ears at Œlich“ reaches •‹– movement” mages of Air curfe connected ƒ„plosion of the sous“ˆois of the oring France ¥£ Social conlict ‡aris and …†F plant in population, a —irector assaulted in France over ‰e žor in oulouse resulting record since 2001 b compan pension reform hrs 0 min in 2,500 inured orers mae the and 0 dead nes orldide Geroge W. 9/11 France ˆeginning George US trade Saddam ˆeginning of Barack Obama’s General Motors ˆarac ‘bama ƒnd of the £e“election of ˆoston End of the Severe tensions ƒlection Withdrawal of Withdrawal of Rising pressures ƒ„plosion of the Bush elected attacs opposes of the war W. Bush is de”icit reaches Hussein is the subprime is elected goes banrupt announces he ar in Iraq Barack Obama marathon ar in folloing the of Donald the US from the the US from beteen Covid cases in the ‡resident the US on war in Iraq reelected unprecendente sentenced to crisis ‡resident ants to reform attacs …fghanistan deaths of two Trump ‡aris the nuclear ™ashington US, ith over in Iraq ‡resident d levels and death and the ”inancial Oussama Ben Afro-American agreement on agreement and eheran 40,000 deaths e„ecuted in he real sstem folloing is illed in citizens killed b climate ith ran household Laden George debt reaches ra© estate maret ˆanruptc the crisis ‡aistan the police Donald Trump Joe Biden is elected W. Bush signs 1•– of collapses of Lehman Bernard Madoff ensions increasingl as 4th ‡resident of the ‡atriot …ct income level Brothers mars is sentenced to he US are leading to ithdras from the US the beginning 150 ears in deprived from several international of the global prison their “AAA” rating shutdowns scene First Œovid case in ˆeginning of ”inancial crisis for the ”irst time in the Œhina, in Wuhan the ar in b S¢‡ administration ŠŽ agreement Afghanistan on GAFA taxation France taes he ‰ice treat Euro Signature of a ƒnlargement he ƒU starts he domain Romania and The crisis hits Angela Merkel ƒurope n ˆrussels, ƒU receives Croatia £ussia ‡aris agreement he “§eave” 0th anniversar mplementation Brexit saga he Uœ Presidency signed in issuance Security Pact of the ƒU to 10 accession name “.eu” Bulgaria oin reland, Spain, is reelected as €especiall the 1Ž ƒuro the Nobel oins the ƒU invades on climate ins in the of the signature of GDPR beteen the leaves the ƒU of the ƒU Februar brings beteen the ne member negotiations provides a ne the ƒU celand and the Šerman France‚ is hit ¤one member Peace Prize Crimea, referendum of the Rome Uœ and in šanuar Œouncil changes to ƒU and ‰…‘ states ith ure space hile Uœ as soon as Œhancellor b Cyclone states agree on ˆeginning of the triggering ƒuropean on Brexit treaty ƒurope the ƒuropean omoting he ƒŒˆ, the 2008 Xinthia the reinforcement implementation strong refugee crisis pr institutions …ngela ’erel ƒuropean Fed and the Šree sovereign of the European Fund for of Bale III geopolitical due to the ar he ƒuropean is elected identit on the Œentral ˆan of debt crisis ”inancial stabilit, on the tensions in Sria ‡arliament Šerman nternet šapan decide to recapitali¤ation of bans, approves the —enmar Šreece oins Œhancellor inect ›0ˆ and on the ipe out of comprehensive Europe accounts organi¤es a the Euro zone in the orld 50– of the Šree debt economic and for more than referendum on monetar oned b bans‹ trade agreement 30 million oining the single sstem €CETA‚ beteen Covid-19 cases curenc‹ ƒlectors Anti-austerity movement ƒU and Œanada vote ¨no¨ €15“’‚ in ƒurope and around the orld * Answer to the question "In your opinion, how will the economic outloo evolve for your inustry in France over the net 3 years" ositive, eutral, e€ative‚ Sources ƒ „e …one, „es Echos, aris …atch, „a †roi, France ‡, europaˆeu st st 6 21 edition AmCham-Bain Barometer 21 edition AmCham-Bain Barometer 7
2021 barometer on American investors satisfaction in France 6 figures to remember: -8 points 96% France’s NPS® as a country in which to set up a business in 2020 slightly 96% of investors praise the measures to support businesses fell to -20%, 8 points lower than in 2019. in France and the recovery plan. They consider them to be as competitive as those in other European countries or even more It loses 12 points to -24% when it comes to the NPS of a company already competitive (54% for the business support measures and 39% established in France that is looking to expand its activities. for the recovery plan). This figure can certainly be explained by an unprecedented economic downturn linked to the Covid-19 crisis, but it should not lead us to lose sight of the historical and structural obstacles or weaknesses in France that show more polarized perceptions: social climate, taxation, work flexibility, etc... ~40% 2 years About 40% of American investors anticipate a positive evolution of the More than ¾ of investors think that it will only take their company economic context in France in the next 2-3 years 2 years or less to reach an economic activity equivalent to the This is only 2 pts less than last year. pre-Covid-19 crisis On the other hand, 23% anticipate a negative trend, compared to 11% last year. For ~60% of respondents, the crisis will have a neutral impact on their investments in France. ~10% believe that it will have a positive impact, against ~25% who anticipate a negative impact, the others preferring not to express an opinion. 54% >85% 54% of American investors believe that the social climate is a More than 85% of investors have a positive or very positive weakness compared to other European countries, and that it hinders perception of the innovation ecosystem in France. their investments. In particular, workforce qualification, government support for the new economy The social climate is becoming the most important investment factor in France, and IT infrastructure are seen as France’s strengths in the quest for innovation. with 100% of investors considering it is an important factor, or even a very important one for 80% of them. st st 8 21 edition AmCham-Bain Barometer 21 edition AmCham-Bain Barometer 9
A moderate decline in optimism A halt to job creation perspectives Unsurprisingly, the results of our 2021 After years marked by optimism for job barometer reflects what happened during creation, American companies, France’s the past year. The satisfaction of American largest foreign employers, expect to pay investors regarding the economic outlook in the price for the Covid crisis. Last year, 51% France is only going down slightly this year, of them thought that the number of their despite the current Covid crisis. Above all, employees would increase. This year, they the polarization of perceptions is remarkable are only 27%. It is even the first time since this year, with 39% of investors anticipating a 2016 that they are more to think that the positive evolution of the economic context, number of their employees will decrease but an increase in those predicting a negative (28% of investors). Many expect to have to outlook from 11% to 23%, reflecting the make adjustments in the next few years to uncertainties of our times. It is also worth compensate for the revenue declines of 2020. mentioning that the outlook is comparable to that of 2018. This apparent positive sign should not hide the fact that many investors simply anticipate a catch-up after the economic downturn in 2020. Projection How will the economic outlook evolve for Over the next 2-3 years, how will the number your industry in France over the next 2-3 of employees evolve in your company years? in France? American investors outlook on France 9% 11% 5% 7% 15% 20% 13% 17% 24% 28% 19% 23% 33% 33% 35% 42% 36% 48% 41% 50% 33% 49% 31% 45% 72% 46% 49% 52% 51% 41% 39% 42% 27% 30% 36% 21% 27% 2015 2016 2017 2018 2019 2020 2015 2016 2017 2018 2019 2020 Positive Stable Negative Don’t know Increase Stable Decrease st st 10 21 edition AmCham-Bain Barometer 21 edition AmCham-Bain Barometer 11
France’s image: weakened but still attractive Even if 48% of investors believe their Choose France headquarters have a good or excellent image of France, this figure is down for the first time Pro-business reforms since 2015, and at its lowest level since 2017. Last year, nearly 65% of investors had a good promised by President image of France. The economic situation alone Macron is not enough to explain this decline: it is the historical weaknesses and France’s persistent “old demons” that investors are pointing at: a difficult labor climate, excessive costs and The CChoose France summit has administrative redtape. been postponed to a later date this year before the summer. But Emmanuel Macron still spoke In your opinion, how do your headquarters with about a hundred foreign view France in comparison to other executives at the end of January. destinations in terms of investment? 13% 9% 6% 25% 15% Perception 33% 27% President Macron has promised 30% to continue the reduction of 36% corporate tax, which will be France and its regions as seen by American investors 39% 37% reduced to 25% next year. 43% 49% 100 billion euros 55% It is the amount of the recovery 50% plan detailed by the President, 42% promising companies to “prepare 44% France for the next decade”. 25% 16% 9% 2% 5% 6% 6% 4% 2015 2016 2017 2018 2019 2020 Positive 18% 30% 48% 55% 64% 48% perception Excellent Good Average Bad st st 12 21 edition AmCham-Bain Barometer 21 edition AmCham-Bain Barometer 13
France’s NPS as an investment destination On a scale from 0 to 10 (10 being the highest France’s strengths and weaknesses as seen by American investors in 2020: a limited decline rating), would you recommend France to a U.S. France’s strengths and weaknesses in 2020 are very similar to previous years. The cultural In 2020, despite the Covid crisis, the company seeking to establish business abroad? environment, quality of life and geographic location are the main strengths; redundancies number of promoters in France remained (costs and procedures) and labor costs are the main weaknesses. These weaknesses, which relatively stable at 16%. On the other hand, are persistent and particularly troublesome in a context of crisis, are contributing to the decline the number of detractors increased by in France’s attractiveness this year. 7 points, a polarization that stems from 33% 29% 29% 36% formerly neutral investors. However, France 65% 54% Regarding those factors, how does France compare with other European countries? seems to have absorbed the shock relatively 46% 58% 54% well, with an 8-point drop in the NPS to 47% -20%. This NPS remains higher than over the 32% 43% STRENGTHS WEAKNESSES 3% 3% 21% 14% 17% 16% 21% 25% 30% 11% 12% 19% 27% entire 2009-2016 period, a good score that 36% 40% 44% 49% 54% 57% 58% 46% can be explained by the reforms undertaken 2015 2016 2017 2018 2019 2020 50% 62% 73% 73% 69% NPS* -62% -51% -12% -15% -12% -20% 61% 62% 80% since 2017 and welcomed by more than 70% 78% 67% of investors. Promoter Neutral Detractor 73% 69% 60% 56% 54% 71% 52% 46% 44% 39% 41% 39% 25% 30% 33% 28% 26% 24% 18% (*) Net Promoter Score (NPS) = % promoters (grade of 9 to 10) - % detractors 14% 7% (grade of 0 to 6) e D y s h y y R t y y s s s s Note : in percentage of answers. Quality of lif proceduresFlexibilit companies Complexity of What are the main investment criteria for U.S. investors? and innovation private service Legal certaintrkforce availabilitEconomic contexSocial climate andpolitical stabilitof working hourRelocation costRedundancy cost th Cultural environmentGeographic locationrkforce qualificationInfrastructure qualitQuality of public andWo Simplicity of admin. x system for foreign rkforce overall cost Formerly ranked 5 among the decisive criteria in their investment choices, the social climate Wo Opportunities for R& Energy supply and costBanking sector strengtImportance given to CS Ta redundancy proceduresWo becomes in 2020 the first investment factor for American investors, 100% of them considering Strength Equivalent Weakness it is an important factor. It shows the persistence of an issue that crystallizes expectations but that reforms have not yet been able to satisfy. As in previous years, the quality and availability of the workforce, the economic context and legal certainty remain the major criteria for investors. Priority levers to strengthen France’s attractiveness How important are the following factors in your company’s investment decisions? In 10 years, France has been able to consolidate or make use of its strengths (workforce quality, geographic location, infrastructure, innovation), without however managing to reverse the trend in terms TOP 5 of its structural weaknesses, which are perceived as obstacles for investment decisions by American 21% 7% 8% 9% 10% 12% 15% 17% 18% 18% 20% 23% 25% companies. Improving the labor climate, adapting the tax system, and decreasing labor costs are still 31% 26% 27% 37% 30% 36% 33% 37% the main ways to improve the country’s attractiveness. 44% 34% 45% 46% 33% 49% 41% 38% 46% 60% 50% 51% 79% 72% 70% 53% 37% France positioning 68% 61% 67% 60% 58% 49% 43% 45% 42% 43% 43% 49% 35% + Cultural Geographic 1 2 3 4 5 24% 26% 24% 25% environment Quality of life location 14% Workforce Assets to use y t y y s s y s e s s y D R e h Quality of public Infrastructure qualification Workforce, location, and private services quality innovation, legal certainty stabilit Energy supply and cost R&D and infrastructure service Legal companiesprocedures procedures Banking sector Importance Workforce availability certainty Legal certaint Relocation cost and innovationQuality of lif strength given to CSR Economic contexrkforce qualificationrkforce availabilitrkforce overall costx system for foreignSimplicity of admin.Geographic locationInfrastructure qualitRedundancy costCultural environment Economic context Wo Wo Ta Opportunities for R& Relocation costs Social climate and political Priorities for Wo Banking sector strengtEnergy supply and cost Flexibility Tax system stability Previous Social climate and political Flexibility of working hour Complexity of redundancImportance given to CS of working hours improvement ranking Quality of public and privat Admin. procedures for foreign companies Costs, labor legislation, Complexity of redundancy tax regime and adminis- 2018 371 52869410 12 14 n.a. 11 13 15 16 18 17 19 20 procedures Workforce trative procedures, Redundancy costs overall costs social climate 2019 513 124671312 0914 n.a. 11 815161817 19 20 - - Importance of criteria + Very important Relatively important Not important Criteria position in 2011 Criteria position in 2020 st st 14 21 edition AmCham-Bain Barometer 21 edition AmCham-Bain Barometer 15
An economy focused on the future Excluding Covid, 2020 was also: According to 82% of American investors, the Once again this year, American investors’ perception of the French innovation ecosystem is positive 2020 showed a pause in the governmental election of President Biden will have a positive (for 86% of respondents) or very positive. In particular, investors praise the workforce qualification, reforms governments. In this context, investors impact on transatlantic relations. However, government’s support for the new economy and IT infrastructure, which are respectively cited as fear that the reforms needed to boost France’s they believe that this event will have less France strengths by 81%, 57% and 48%. Concerning access to capital and financing, they frequently attractiveness could be postponed, or even impact on their investments than the Green mention the relatively easy access to initial financing (Seed and Series A) but the difficulties cancelled. 71% of them still have a positive Deal and than Brexit (especially), which will encountered in financing scale-ups, a field in which the United States, on the other hand, excels. perception of these reforms, but it is 15 points have a strong or very strong impact for 35% of less than in 2019. On France’s competitiveness investors against 9% for the election of Biden. and the economic situation, the positive What is your general per- In your opinion, when you consider investing, what are France’s perception respectively loses 10 and 17 points In your opinion, what impact will the election th ception on the innovation strengths and weaknesses in terms of innovation & digitalization? to reach 64% and 61%. These figures, even if of Joe Biden as the 46 President of the ecosystem in France? they remain good, should alert the government United States have on transatlantic relations? on investors’ expectations for the country to 4% 3% 7% 7% continue implementing the reforms. 11% 16% 25% 22% 28% 14% 37% 45% 49% The pause in reforms also marks a slight relief 39% 46% in the social climate in France, but it is still 41% negatively perceived by 57% of investors. 81% 62% 66% 57% 48% 44% 37% 32% 31% What is your assessment of the reforms Don’t know 7% implemented since President Emmanuel Workforce IT Access to capital Innovative and Macron’s election? Neutral Very negative qualification infrastructures and funding flexible legal 20% Positive Negative framework 3% 3% 3% 3% Very positive Neutral State support Entrepreneurial Strong digital 9% 8% 5% 11% 2020 20% Positive to the new economy spirit penetration within 13% Very positive companies and households 24% 2020 22% 26% Strength Neutral Weakness To what extent each of the following events 46% 42% will impact your investment strategies in Another key topic for In your opinion, does France offer a supportive regulatory Europe? the future, CSR, is at the framework to private companies’ social and environmental 52% forefront of France’s strategy, commmitment? 55% 50% 13% 11% since nearly 70% of investors 28% 29% 4% 33% consider the regulatory 18% 23% framework to be conducive 24% 19% 9% 11% 11% to companies’ social and 5% environmental commitment, Foreign France Economic Franco- Social 27% investment competi- situation American climate but still deplores the in France tiveness in France relations in France 34% lack of predictability of in general 40% environmental legislation. 50% Positive perception 71% 64% 61% 38% 13% Don’t know 2020 Not at all Not supportive at all Evolution 34% Not really Not supportive vs. 2019 28% 20% Neutral Neutral Positive Strongly 8% Supportive perception 86% 74% 78% 31% 12% 18% 2019 7% 7% 7% Very strongly Very supportive Very positive Positive Neutral Brexit The Green Joe Biden's 2020 Negative Very negative Don’t know deal election st st 16 21 edition AmCham-Bain Barometer 21 edition AmCham-Bain Barometer 17
France and its regions For the regions you settled in, what were the main determining factors (maximum 3) To explain their choice of settling in a particular regions, American investors overwhelmingly favor Île de France Grand Est Hauts-de-France geographic location as one of the three most determining factors for >70% of investors. The economic 80% 80% dynamism of the region, the quality of the infrastructure, and the qualification of the workforce are cited as the other key criteria for settlement decisions by 30 to 40% of investors. The policies and actions carried out in terms of attractiveness by the Grand Est and Hauts-de-France regions convince a majority of investors. 63% For the regions you settled in, what were the main determining factors (maximum 3) 48% 50% All regions 43% 42% Mostly acquisitions 71% 38% or historical location 33% 30% 25% 25%25% 21% 20% 10% 13% 8%7% 5% 4% 4% s s s s s s 0%0% m e Other m e Other m e Other Location rkforce Locationrkforce Location rkforce 41% InfrastructureWoQuality of lifRegional aidsWoInfrastructureRegional aidsQuality of lifInfrastructureWoRegional aidsQuality of lif 34% Economic dynamisImplementation cost Economic dynamisImplementation cost Implementation costEconomic dynamis 31% Mostly acquisitions or Are you satisfied with the policies and actions carried out by the regions in which you are located historical location to attract foreign investment? Île de France Grand Est Hauts-de-France 14% 2% 5% 11% 29% 9% 44% 6% 53% 41% Geographic Infrastructure Implementation Regional aid 39% location quality costs 36% Economic Qualification Quality Other 29% dynamism and availability of life 17% of workforce 5% Very positive Positive Neutral Negative Very negative st st 18 21 edition AmCham-Bain Barometer 21 edition AmCham-Bain Barometer 19
Focus – impact de la COVID-19 A violent crisis, but only temporary and without The government supporting the economy... … but triggering a debt deepening In line with the relative optimism regarding consequences for France in the long run? In an economy that has been slowing down The consequence of these ambitious the economic environment for the next 2-3 Nearly 60% of American investors believe that since March 2020 and the first lockdown, U.S. support measures is the substantial years, more than ¾ of US investors believe the Covid crisis will not have any impact on investors are praising the support measures increase in public debt, which worries 70% that it will take 2 years or less to return to their investments in the medium term. implemented by the French government. 96% of American investors. They fear strong fiscal an economic activity comparable to 2019. In particular, they note that the crisis has led of them find these measures as competitive, adjustments in the coming years to offset More than 1/3 even think they could reach them to postpone some investment decisions or even more competitive, than the measures this spending. that level in less than a year. but should not cause them to change course. implemented by of other European countries. 24% nevertheless think they will reduce their Indeed, more than half of American investors investments, particularly because of the post- (53%) consider that these measures are more crisis restructuring that will be necessary. competitive compared to the rest of Europe. Investors also positively welcome the recovery plan. 96% of them consider it “as competitive” as the other European countries or more with 39% of them finding it more competitive. In your opinion, how long will it take your What will be the impact of the Covid-19 crisis How did your headquarters perceive What is your opinion regarding company to return to its pre-Covid-19 on your investments in France in the medium the measures taken by the French public the public debt? economic activity level? term? authorities to support companies since the beginning of the Covid crisis? In comparison with other European countries 3% 1% 4% 10% 3% 4% 21% 6% 22% 18% 42% 40% 43% 58% 40% Don’t know Much less competitive 36% Very negative Don’t know More than five years Negative Less competitive 28% Confident Three to five years Neutral As competitive Neutral One to two years Positive 13% More competitive Worried 1% 8% Much more Less than a year Very positive competitive Very worried 2020 2020 2020 2020 st st 20 21 edition AmCham-Bain Barometer 21 edition AmCham-Bain Barometer 21
AmCham recommendations The 2021 AmCham-Bain barometer took place in a very atypical period. It is therefore essential to keep this in mind when reading the barometer results this year, as the different trends may be impacted by this changing context in the coming months, which may result in the acceleration or delay of certain factors. 1. Enhancing the strengths of French regions In the current context, the regions have that could be awarded to CEOs of Ameri- demonstrated great agility and proximity can companies with a strong regional to their populations and industries, and footprint who could testify about the these are now more than ever key factor success of their own installation and for France’s attractiveness. promote their development. Relying on its members companies settled AmCham France is committed to keep in the regions, AmCham France will on surveying U.S. companies located in intensify its efforts to promote the regions the regions to better understand their in the relocation of certain industries and needs and expectations and to share this in the implementation of new growth information with regional executives. opportunities pursued by the government in association with regional executives and AmCham France will partner with the U.S. local officials. Consulates and the U.S. Embassy in France to actively strengthen the attractiveness AmCham France recommends to of the regions. better promote the assets and policies implemented by the regions to attract investments by giving them more visibility among international investors. In this perspective, AmCham France encourages the creation of a status of Regional Investment Ambassador st st 22 21 edition AmCham-Bain Barometer 21 edition AmCham-Bain Barometer 23
2. 4. Seizing the crisis as an opportunity to strengthen the attractiveness Pursuing the ambitious impulse for innovation of labor market AmCham France welcomes and mechanisms that favor them. This key Employment and labor law are seen as new entrepreneurial frameworks for career encourages the continued commitment to maintain research in our country and obstacles for investment in our country. and labor management. With its resources of the government to support the new to foster joint investment opportunities After a sizeable improvement in recent and talents, there is an opportunity economy, particularly in the face of the from abroad, and from the United States years, especially since the 2017 labor law, for France to emerge stronger from crisis. These ambitious policies play an in particular. When it comes to innovation, it is clear that the procedures are still these challenging times. Telework must essential role in France’s international it is crucial to remember that France and perceived as somewhat complex and that therefore be seen as an opportunity and influence and the success of French Tech, the US are true partners. the lasting instability of the social climate not as a threat. while strengthening the competitiveness AmCham France advocates for an has finally taken its toll. This appears of the French innovation ecosystem. Proof easier access to capital and financing, clearly in this year’s edition of AmCham France commits to initiate a of this is the fact that 86% of investors the barometer. reflection in this subject in order to come have a positive or very positive perception encourages companies (especially up with concrete proposals by the second of this ecosystem. SMEs) to continue their digitalization, However, the societal transformation that half of 2021 that can be acted upon by the continues to support the development of is taking shape in the light of the crisis public authorities. However, it has become clear in recent an entrepreneurial culture while working may provide an opportunity to imagine weeks that France does not nurture the to adapt a regulatory framework that is necessary risk culture for a successful increasingly favorable to innovation and innovation policy. It is essential to change venture capital. 3. this mindset and to direct savings towards innovative companies with structured Transforming ecological transition and inclusion into drivers of attractiveness 5. AmCham France applauds the impulsion expectations towards companies take a Maintaining investors’ confidence by ensuring regulatory and tax predictability of the Recovery Plan, which makes the global scale. ecological transition a driving force for economic recovery. However, in order to make the ecological AmCham France welcomes the 20 billion to reassure investors by giving them transition and inclusion a driving force for euro reduction in Production Tax and the more visibility on the policy measures Today, 69% of American investors believe attractiveness, it is essential to highlight progressive reduction of the Corporate considered to meet these challenges. that France offers a regulatory framework innovative initiatives led by companies, Income Tax rate to 25% by 2022. We are France’s operating debt should be clearly that is conducive or even very conducive while strengthening consultation convinced that these measures will allow dissociated from the investment debt to the societal and environmental and collaboration between different France to considerably strengthen its associated with the Covid crisis. commitment of companies. We are economic sectors. The promotion attractiveness and we therefore believe it is convinced that France can play a major and encouragement of co-creative more essential than ever to maintain these Moreover, even when some overriding role in promoting the ecological transition approaches will favor the emergence of commitments over the long run. international policy objectives are pursued, in Europe and around the world by innovative, even disruptive, solutions, the consistency of the discourse and making this transformation a real driver of which constitute one of the keys In the same way, for 70% of investors, the signals sent are essential to France’s attractiveness for companies. It is all the to a sustainable and successful French public debt is a source of concern. attractiveness. AmCham will join in the more important in a time when ecological ecological transition today. Facing these uncertainties and the risks pursuit of this delicate balance. transition is such a key topic for the they pose to investment dynamics, transatlantic relations and when society AmCham France invites the government st st 24 21 edition AmCham-Bain Barometer 21 edition AmCham-Bain Barometer 25
Methodology and interviewed About American investor profiles AmCham France published the first survey We collected 124 responses from companies on the satisfaction of American investors in representing a total of more than 58,000 France in 1995. With the collaboration of Bain employees in France and more than 54 billion & Company, the Barometer became an annual euros in sales in France. AmCham in France Bain & Company event in 1999. The sample of responding companies is The AmCham-Bain Barometer, which is in its balanced and representative, both in terms AmCham France was founded in 1894 to Bain & Company is the international consulting st 21 edition in 2021, meets 3 objectives: of company size, sector of activity and promote economic exchanges between firm that helps ambitious executives transform • To measure from one year to the next geographic location in the Ile-de-France region France and the United States. As an their companies into pioneers of tomorrow’s the satisfaction of American investors or in the regions: it includes 42% of companies association, AmCham France offers a unique world. in France and their perception of the with more than 1,000 employees in France, space for networking to foster exchange and Through 59 offices in 37 countries, we partner economic environment 42% of companies who have between 100 and promote constructive thinking, acting as with our clients to achieve extraordinary 1,000 employees, and 16% of companies with a bridge between political, economic, and results that enable them to outperform the • Understand the strengths and weaknesses less than 100 employees. academic circles. competition and redefine their industry. of France for U.S. investments as well as The most represented sector is the chemical/ Today, it brings together leading French and Our integrated and customized expertise the “drivers” and “deterrents” of living in parachemical sector (15% of respondents) American companies, as well as numerous provides companies with access to a dynamic France for U.S. employees. followed by research and consulting firms (14% academic and economic partners, attached ecosystem that brings together the most • Gather the opinion of American investors of respondents). The pharmaceutical, IT and to fostering the transatlantic relationship. innovative digital and technology players. on topics that made the economic news in transport sectors each make up 10%, 9% and Independent of any government and With this approach, our clients achieve better, France, including the exceptional situation 8% of the sample. Among the other sectors convinced that businesses have a crucial faster and more sustainable results. related to Covid-19. represented, we can cite food processing, role to play in bringing new ideas to the Through our commitment to invest more heavy industries, legal advice and tourism. The public debate, AmCham France develops than $1 billion over 10 years in volunteer Between December 2020 and January 2021, typology of the respondents is shown in the concrete proposals to meet the major societal, we shared a questionnaire with the managers graph below. economic, and environmental challenges. activities, we mobilize our talents, resources of most French subsidiaries of American and expertise with non-profit associations and companies. They are mainly managers: presidents and As such, AmCham France is committed organizations to address pressing challenges directors of companies (35% of the sample) to strengthening France’s attractiveness. in education, racial and social equity, and or other members of management On behalf of its members, AmCham France economic and environmental development. committees (28%). works with public decision-makers to develop Since the founding of Bain & Company and consolidate a French environment that in 1973, we have measured our success by 35% is favorable to international companies, the companies that have placed their trust 28% particularly American companies, which in us: we are proud to have the highest are the leading foreign investors and recommendation rate in the consulting 19% 18% employers in France. industry. Chairman and CEOOther Directors Institutional relations Other st st 26 21 edition AmCham-Bain Barometer 21 edition AmCham-Bain Barometer 27
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