34 Projects for France’s “Industrial Renaissance”

Minister of Industrial Recovery Montebourg is hoping that public and private investment in French industry will spur growth in manufacturing. Here, industry complexes along the Seine in Paris. Photo: Thomas Claveirole for flickr.

Minister of Industrial Recovery Montebourg is hoping that public and private investment in French industry will spur growth in manufacturing. Here, industry complexes along the Seine in Paris. Photo: Thomas Claveirole for flickr.

A film on the Elysée website reminds viewers that France gave the world the steam locomotive, the automobile, the motorized scooter, cinema, modern medicine, and radioactivity. The voice of Charles de Gaulle booms, “We must obtain the rung of a great industrial state or resign ourselves to decline.”

This is the introduction to a new plan for an “industrial renaissance,” conceived by Arnaud Montebourg, the Minister of Industrial Recovery. Montebourg has worked behind the scenes on the idea during the last year.

The plan consists of 34 state-aided projects aimed at strengthening France’s industrial sectors and placing the country among the leading industrial nations within the next ten years. The plan’s three major themes include energy, health, and digital technology.

It is intended to prepare France’s most promising industries – the TGV, the driverless car, textiles, biofuels, biomedical technology, and others – for global competition. According to McKinsey & Company, an international management consulting firm, changes in way of life in the near future are going to have industrial consequences, in terms of products and creation of jobs, if the country chooses to exploit them.

The promise for industrial growth is much needed. The current status of French industry is grim, with 49,600 industrial jobs lost in August alone, according to Insée, the National Institute of Statistics and Economic Studies in France.

The government expects the projects will create some 475,000 jobs, increase exports by 18 billion euros, and create 45 billion euros in revenues over the next 10 years. This growth should make up for a significant amount of the 750,000 jobs lost by French industry in the past decade.

The government has revealed that public funds will be used to finance the projects, but the majority will come from private investment. Hollande’s aides insist that 10 euros from the private sector will match each euro of the taxpayers’ money.

Montebourg explains that the public and private spheres will unite to achieve this “industrial renaissance,” and in more ways than the shared funding. The individual projects will make use of both public and private research as well.

In addition, the private sector holds a substantial degree of responsibility with respect to implementation. Project leaders from various industries are in charge of forming teams and liaising between the public and private sectors.

Only six of the 34 projects will not be entrusted to the industries themselves, a liberty which has never before been accorded in France’s history. It is the hope that the interest of both leaders and employees of each industry will contribute to the success of the plans.

The State, on the other hand, will intervene through legislation, fiscal means, orders, and public financing, including future investment plans. Up to 3.7 billion euros of public money will be spent in support of the plans.

Many private actors are positive about the government’s efforts, including Eric Carreel, the president of Withings, a consumer electronics company. Carreel agrees that a cultural revolution creating an “ecosystem” between start-ups and the electronics and other industries is more important than spending public money.

Others are critical of the plan’s size and scope. Guillaume Cairou, president of the Club of Entrepreneurs, believes that only two plans are needed for the recovery of French industry – improvement of industrial tools and of production technologies. He claims that France’s problem is its productivity, and that massive investment is needed in these two areas in order to make progress.

Industry is only 11% of French GDP, while it comprises 15% of Spain’s, 17% of Italy’s, and 23% of Germany’s, claimed Montebourg in an interview with Le Monde. Although this is “not mediocre,” he said, “it is too small to guarantee the prosperity of our country.” If this is indeed the case, then France must succeed in growing and strengthening the industrial sector. Whether 34 projects or two is the solution, both public and private actors will be hopeful that industrial growth in France can accelerate.

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