INTRODUCTION
France ranks in the top ten nations with the highest GDP (PPP- purchase power parity) in the
world. Though the growth rate of the French economy is considerably slower compared to the
other European countries, the population below the poverty line is relatively minor. It is said to
be one of the lowest in the world.
It is observed that less than 10% of the French population is poor after deduction of necessary
taxes. The unemployment rate in France is also one of the highest in the European Union,
which is over 7%, based on the results of a survey done in the year 2008.
France has been one of the strongest economies in Europe and was a prime supporter of the
European Union, making Euro its single currency. The Euro completely replaced France’s local
currency, the Franc, in the year 2002. The three sectors that are main contributors to the
national GDP are:

service industry

manufacturing industry

agriculture industry.

Service industry
The service industry is the highest revenue generating industry in France. It generates about
three-fourths of the national GDP. The different types of potential service industries are:
hospitality, finance, insurance, legal, logistics and other similar business service industries.
Manufacturing industry
France is one of the leaders in applying the latest technology in different types of
manufacturing industries. The French government also spends a considerable amount of money
doing research to invent new technologies that would improve the quality and quantity of
industrial products.
Secondly, though France doesn’t have oil reserves of its own, it does have a strong base of
nuclear power generators that provides the necessary energy required to drive its industry.
Almost 80% of the total electricity requirement is fulfilled by the nuclear power generation
plants
The prominent manufacturing industries of France include but are not limited to: aerospace,
automobile, armament, construction, chemical, telecommunication, satellite equipment,
shipbuilding, and pharmaceutical. These diverse industries create around 25% of the national
GDP.
Agriculture
France is one of the largest agricultural countries in the world and ranks in the top ten
producing nations. With the surplus production, France is able to export a substantial amount
of agricultural products like:

wheat

poultry

beef

dairy products.
The main importing countries of these products from France are other neighboring nations in
European Union and those in the African continent. Regardless of these positive aspects, the
agriculture industry contributes less than 5% towards the GDP.
GDP GROWTH
3,5E+12
3E+12
2,5E+12
2E+12
1,5E+12
1E+12
5E+11
Time
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
2017
2019
0
GDP GROWTH
Nominal GDP of France was $2,958 billion in 2021. The indicator recorded a year-on-year
growth of 12.1% in 2021 and between 2010 and 2021, the indicator increased by 11.9%. The
nominal GDP of France was highest in the year 2021 and lowest in the year 2015, between 2010
and 2021. France’s real GDP hit $2.9 trillion in 2021, an increase of 7.0% over the previous
year.
GDP (constant 2015 US$)
3E+12
2,5E+12
2E+12
1,5E+12
1E+12
5E+11
Time
1973
1975
1977
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
2017
2019
0
REAL GDP
The Real GDP of France was $2,577 billion in 2021. The indicator recorded a year-on-year
growth of 12.1% in 2021 and between 2010 and 2021, the indicator increased by 11.9%. The
real GDP of France was highest in the year 2019 and was $2,616 and lowest in the year 1972
and was $1,002 billion, between 1972 and 2021. France’s real GDP hit $2.9 trillion in 2021, an
increase of 7.0% over the previous year.
Gross fixed capital formation (constant 2015 US$)
INVESTMENT
7E+11
6E+11
5E+11
4E+11
3E+11
2E+11
1E+11
Time
1973
1975
1977
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
2017
2019
0
INVESTMENT
Gross Fixed Capital Formation in France averaged 73547.86 EUR Million from 1949 until 2022,
reaching an all time high of 145807.00 EUR Million in the fourth quarter of 2022 and a record
low of 11871.00 EUR Million in the first quarter of 1949. Gross Fixed Capital Formation in
France is expected to be 141694.00 EUR Million by the end of this quarter, according to Trading
Economics global macro models and analysts expectations. In the long-term, the France Gross
Fixed Capital Formation is projected to trend around 148735.00 EUR Million in 2024 and
151264.00 EUR Million in 2025, according to our econometric models.
France Gross Fixed Capital Formation in 2020 was $556B, a 30.96% increased from 2010.
France Gross Fixed Capital Formation in 2010 was $511B, a 70.8% increased from 2000.
France Gross Fixed Capital Formation in 2000 was $454B, a 57.97% increased from 1990.
France Gross Fixed Capital Formation in 1990 was $383B, a 68.9 increased from 1980.
Final consumption expenditure (constant 2015
US$)
2,5E+12
2E+12
1,5E+12
1E+12
5E+11
Time
1973
1975
1977
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
2017
2019
0
CONSUMPTION
France Final consumption expenditure (constant 2015 US$) in 2021 was $1995B, a 12.08%
increase from 2010.
France Final consumption expenditure (constant 2015 US$) in 2010 was $1824B, a 56.3%
Increase from 2000.
France Final consumption expenditure (constant 2015 US$) in 2000 was $1535B, a 59.92%
increased from 1990.
France Final consumption expenditure (constant 2015 US$) in 1990 was $1284, a 70.3% was
increased from 1980.
Government expenditure
7E+11
6E+11
5E+11
4E+11
3E+11
2E+11
1E+11
Time
1973
1975
1977
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
2017
2019
2021
0
Government Spending in France averaged 76831.94 EUR Million from 1949 until 2022, reaching
an all time high of 144415.00 EUR Million in the fourth quarter of 2022 and a record low of
16868.00 EUR Million in the first quarter of 1949. This page provides the latest reported value
for - France Government Spending - plus previous releases, historical high and low, short-term
forecast and long-term prediction, economic calendar, survey consensus and news. France
Government Spending - values, historical data and charts - was last updated on March of 2023.
Inflation
$14,00
$12,00
$10,00
$8,00
$6,00
$4,00
$2,00
2019
2017
2015
2013
2011
2009
2007
2005
2003
2001
1999
1997
1995
1993
1991
1989
1987
1985
1983
Time
$-
Inflation as measured by the consumer price index reflects the annual percentage change in the
cost to the average consumer of acquiring a basket of goods and services that may be fixed or
changed at specified intervals, such as yearly. The laspeyras formula is generally used.
France inflation rate for 2021 was 1.64%, a 1.17% increase from 2020.
France inflation rate for 2020 was 0.48%, a 0.63% decline from 2019.
France inflation rate for 2019 was 1.11%, a 0.74% decline from 2018.
France inflation rate for 2018 was 1.85%, a 0.82% increase from 2017.
Unemployment
14
12
10
8
6
4
2
Time
1973
1975
1977
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
2017
2019
0
The unemployment rate in France slightly fell to 7.2% in the fourth quarter of 2022 from 7.3%
in the previous quarter, and compared to market forecasts of 7.3%. This was the lowest level
since Q1 2008, except for the sharp fall in Q2 2020 during the first lockdown. The number of
unemployed people decreased by 45,000 to 2.2 million. At the same time, the unemployment
rate for people aged 15-24 surged 0.1 points to 16.9%. However, the unemployment rate was
stable for those aged 25 to 49 at 6.5% and decreased for those aged 50 or more to 5% (–0.1
points). Among genders, the jobless rate was slightly lower for women (at 7.1 percent) than for
men (at 7.5 percent). The employment rate was unchanged at 68.3%, the highest level since
INSEE measures it according to ILO’s definition. Meanwhile, the activity rate edged down by 0.1
points to 73.6% from 73.7%.
import of goods and services (annual % growth
1E+12
9E+11
8E+11
7E+11
6E+11
5E+11
4E+11
3E+11
2E+11
1E+11
2019
2017
2015
2013
2011
2009
2007
2005
2003
2001
1999
1997
1995
1993
1991
1989
1987
1985
1983
1981
1979
1977
1975
Time
1973
0
France - Imports of goods and services was 38.10 % of GDP in December of 2022, according to
the EUROSTAT. Trading Economics provides the current actual value, an historical data chart and
related indicators for France - Imports of goods and services - last updated from
the EUROSTAT on March of 2023. Historically, France - Imports of goods and services reached a
record high of 38.10 % of GDP in December of 2022 and a record low of 28.10 % of GDP in
December of 2010. In 2000 was increased 45.8% from 1990 and 1980 it was recessionary.
Exports of goods and services (constant 2015
US$)
9E+11
8E+11
7E+11
6E+11
5E+11
4E+11
3E+11
2E+11
1E+11
Time
1973
1975
1977
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
2017
2019
0
Exports of goods and services (annual % growth) in France was reported at 8.772 % in 2021,
according to the World Bank collection of development indicators, compiled from officially
recognized sources. France - Exports of goods and services (annual % growth) - actual values,
historical data, forecasts and projections were sourced from the World Bank on March of 2023.
In 2010 was declined 3.97% from 2000. 1990 increased 40.9% from1980.
Inflation and Unemployment relationship
The concept behind the Phillips curve states the change in unemployment within an economy
has a predictable effect on price inflation. The inverse relationship between unemployment
and inflation is depicted as a downward sloping, concave curve, with inflation on the Y-axis
and unemployment on the X-axis. Increasing inflation decreases unemployment, and vice
versa. Alternatively, a focus on decreasing unemployment also increases inflation, and vice
versa
.The belief in the 1960s was that any fiscal stimulus would increase aggregate demand and
initiate the following effects. Labor demand increases, the pool of unemployed workers
subsequently decreases and companies increase wages to compete and attract a smaller
talent pool. The corporate cost of wages increases and companies pass along those costs to
consumers in the form of price increases.
This belief system caused many governments to adopt a "stop-go" strategy where a target rate
of inflation was established, and fiscal and monetary policies were used to expand or contract
the economy to achieve the target rate. However, the stable trade-off between inflation and
unemployment broke down in the 1970s with the rise of stagflation, calling into question the
validity of the Phillips curve
Observed economy’s in France
France is one of the major economic powers of the world, ranking along with such countries as
the United States, Japan, Germany, Italy, and the United Kingdom. Its financial position reflects
an extended period of unprecedented growth that lasted for much of the postwar period until
the mid-1970s; frequently this period was referred to as the trente glorieuses (“thirty years of
glory”). Between 1960 and 1973 alone, the increase in gross domestic product (GDP) averaged
nearly 6 percent each year. In the aftermath of the oil crises of the 1970s, growth rates were
moderated considerably and unemployment rose substantially. By the end of the 1980s,
however, strong expansion was again evident. This trend continued, although at a more
modest rate, into the 21st century. During the same postwar period, the structure of the
economy was altered significantly. While in the 1950s agriculture and industry were the
dominant sectors, tertiary (largely service and administrative) activities have since become the
principal employer and generator of national wealth. Similarly, while it was once the heavily
urbanized and industrialized regions of northern and northeastern France that were
developing most rapidly, in the 1980s these areas began losing jobs and population.
Contemporary growth has switched to regions that lie in the south and, to a lesser degree, the
west of France. Despite the dominance of the private sector, the tradition of a mixed economy
in France is well established. Successive governments have intervened to protect or promote
different types of economic activity, as has been clearly reflected in the country’s national
plans and nationalized industries. In the decades following World War II, the French economy
was guided by a succession of national plans, each covering a span of approximately four to
five years and designed to indicate rather than impose growth targets and development
strategies.
Reference
https://databank.worldbank.org/source/world-development-indicators
https://link.springer.com/article/10.1007/BF02300169#:~:text=Conclusion,France%20with%20t
he%20developing%20world
https://www.cambridge.org/core/books/abs/french-economy-in-the-twentiethcentury/conclusion/2524A0DBCA0D06A01949E6D449304CAD
Conclusion
France is the seventh largest economy in the world and the second largest in the Euro Area. the
biggest sector of the economy is household consumption (55 percent) followed by government
expenditure (24 percent) and gross fixed capital formation (22 percent). Exports of goods and
services account for 29 percent of GDP while imports account for 31 percent, subtracting 2
percent from total GDP.