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pestal france

pestal france



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Published by Nikhil Vijapur
things one should know before entering into business in france.
things one should know before entering into business in france.

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Categories:Types, Research
Published by: Nikhil Vijapur on Aug 30, 2010
Copyright:Attribution Non-commercial


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PESTEL Analysis
MBA 16 Page 1
The term of international business is taking an important place in the world today andmany factors are related to international business. A through external environment analysis isvery important before a business is started in a particular country. Here in this we have done aPESTEL analysis for France.
Considering the political part many factors have to be taken into account. France is a developedcountry; the political environment there is stable in the sense that there is no political trouble, nowar, no political crisis, and no conflict; this is a good factor which can attract investors and new business entry. In another way setting up a business in France required a lot of capital from theinvestors. In certain territories in France like: Mayotte, Saint Pierre and Miquelon, Wallis andFutuna, Monaco, the government has fixed an investment limit of 1 500 000 Euros for foreignenterprises. In fact the government has elucidated a precise list of tax or mandatory contributionswhich have to be paid by business people in France. The government of France has no anycontrol on religions or culture, there is no policy stated by the government to restrict any newentry of any business which is not matching with the believes of the French population.
One important factor which contributes a lot in doing a business in another country is theeconomic position of this country. Talking to economic situation is related to many factors suchas: interest rates, level of inflation and employment, gross domestic product of the country(GDP), per capita income and so on. The GDP real growth rate of France has increased from(0.3% in 2008 to 8% in 2009), this reveals a better economic situation of the pays although the phenomenon of recession; in fact France weathered the economic crisis (recession) better thanthe other big countries of Europe. The GDP per capita has shifted from $33800, $33700 to$32800 in 2007, 2008 and 2009 respectively, this shows that a quite standard position of GDP per capita of France which reveals a good economic situation of the country. The unemploymentrate has quietly increased from 7.4% in 2008 to 9.7% in 2009 and the population poverty linewas 602% in 2004. Considering all these aspects it seems that the economic position in France isfavorable to setting up a business.
PESTEL Analysis
MBA 16 Page 2
France population in 2010 is 65,056,792. The age structures of France population are 0-4years 18.5%, 15-64 years 65% and 65 years above have 16.5%.The population growth rate of France is 0.549%.The life expectancy of France, male average age is 77.78 years and femaleaverage age is 84.34 years. The literacy rate of France has 99% of total population. France ishighly developing country there are 75 percent of the people staying in the cities. There are twolanguages spoken by people one as French and another is Catalan. The French people of very proud of their language which is famous worldwide and also shown their identity..There aredifferent religions, Roman Catholic, Jewish and Muslim. In France Islam is the 2
largestreligion. The French people share a great passion of food. France is very famous for cuisine,wines and cheese.
France has an excellent scientific and technological environment. As being the worlds 4
industrial power, one of the world leader in space technology, in nuclear energy, in computer engineering, in environmental protection. All the credit France owes to its quality educationsystem which includes 230 engineering colleges and 87 universities which are well known for their research.Technological and industrial growth funded by the government helps in increasing thestandard of living of people. France spends about 2.2% of its GDP for the development of itstechnology and industrial growth (on research and development). Number of patent application in a country indicates how a process or product offers anew technical solution to a problem. There are about 14743 new patents in 2009. The number of technical journals articles published in France is about 30,309 in the year 2009.The amount France gets by exporting its R & D such as in computers, scientificinstruments; aerospace and electrical machinery is about $93,209,237,841(2009).There is research credit tax (CIR credit import research), it¶s a corporate tax relief whichgovernment forgoes the expenditure of the firm on its R & D operations.
PESTEL Analysis
MBA 16 Page 3
The technological index of France is 4.65.
In France, forest covers about 30.3% of land. France is the first country to have a separateministry for environment. France is been ranked 17
for carbon dioxide emission. The EPI scorefor France is 78.2 and it holds 7
rank.This could be achieved as Frances 78% of energy production comes from nuclear power.France has even imposed a carbon tax. It¶s about 17 Euros per tone of carbon dioxide emitted. Itcontributes about 4.5 billion Euros per year. France carbon emission is about 382,870 kt.Being a member of G8 France has decided to cut short its carbon emission by about 20%2012.
Employment laws
Hiring: Written contract are mandatory to all grades and levels. It should be in French.Firing: cannot be removed unless the organization specifies one of the claws mentioned in theFrench law. The dismissal process on disciplinary basis is very official and failing to pursue the practical steps, even where the firing is clearly reasonable on the merits, May effects in theCourts overturning the firing and ordering the recall of the employee.
The current standard rate is at 19.6%. The reduced rate (for food and books) is 5.5%. A specificrate of 2.1 % applies only to the drugs taken in charge by the Social Security. The net revenue of VAT in 2008 is 126 billion euro.
sidy policy
is applicable only to agricultural and green revolution products.
: Policies on direct investment flows are there since 1984-1985. Both inward and outwardflows are at a higher rate.

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