France's Economy

France's Economy

One of the four West European trillion-dollar economies, France matches a growing services sector with a diversified industrial base and substantial agricultural resources. Industry generates one-quarter of GDP and more than 80% of export earnings. The government retains considerable influence over key segments of each sector, with majority ownership of railway, electricity, aircraft, and telecommunication firms. It has been gradually relaxing its control over these sectors since the early 1990s. The government is slowly selling off its holdings in France Telecom, in Air France, and in the insurance, banking, and defense industries. Meanwhile, large tracts of fertile land, the application of modern technology, and subsidies have combined to make France the leading agricultural producer in Western Europe. A major exporter of wheat and dairy products, France is practically self-sufficient in agriculture. The economy expanded by 3% in 1998, following a 2.3% gain in 1997. Persistently high unemployment still poses a major problem for the government. France has shied away from cutting exceptionally generous social welfare benefits or the enormous state bureaucracy, preferring to pare defense spending and raise taxes to keep the deficit down. The JOSPIN administration has pledged both to lower unemployment and trim spending, pinning its hopes for new jobs on economic growth and on legislation to gradually reduce the workweek from 39 to 35 hours by 2002. France joined 10 other EU members to launch the euro on 1 January 1999.

GDP:

purchasing power parity-$1.32 trillion (1998 est.)

GDP-real growth rate:

3% (1998 est.)

GDP-per capita:

purchasing power parity-$22,600 (1998 est.)

GDP-composition by sector:

agriculture:

2.4%

industry:

28.4%

services:

69.2% (1997)

Population below poverty line:

NA%

Household income or consumption by percentage share:

lowest 10%:

2.5%

highest 10%:

24.9% (1989)

Inflation rate (consumer prices):

0.7% (1998)

Labor force:

25.4 million

Labor force-by occupation:

services 69%, industry 26%, agriculture 5% (1995)

Unemployment rate:

11.5% (1998)

Budget:

revenues:

$222 billion

expenditures:

$265 billion, including capital expenditures of $NA (1998 est.)

Industries:

steel, machinery, chemicals, automobiles, metallurgy, aircraft,

electronics, mining, textiles, food processing, tourism

Industrial production growth rate:

3.9% (1998)

Electricity-production:

480.783 billion kWh (1996)

Electricity-production by source:

fossil fuel:

8.72%

hydro:

12.92%

nuclear:

78.25%

other:

0.11% (1996)

Electricity-consumption:

411.743 billion kWh (1996)

Electricity-exports:

72.64 billion kWh (1996)

Electricity-imports:

3.6 billion kWh (1996)

Agriculture-products:

wheat, cereals, sugar beets, potatoes, wine grapes; beef, dairy products;

fish

Exports:

$289 billion (f.o.b., 1998)

Exports-commodities:

machinery and transportation equipment, chemicals, foodstuffs, agricultural

products, iron and steel products, textiles and clothing

Exports-partners:

Germany 16%, UK 10%, Italy 9%, Spain 8%, Belgium-Luxembourg 8%, US 6.5%, Netherlands 4.5%, Japan 2%, Russia 0.9% (1997)

Imports:

$255 billion (f.o.b., 1998)

Imports-commodities:

crude oil, machinery and equipment, agricultural products, chemicals, iron

and steel products

Imports-partners:

Germany 17%, Italy 10%, US 9%, Belgium-Luxembourg 8%, UK 8%, Spain 7%,

Netherlands 5%, Japan 3%, China 2.