PESTLE Analysis of France

Pestle analysis of France. The French Republic is a Western European country. It has also got several islands in the Indian, Pacific, and the Atlantic Ocean and French Guiana in South America as overseas territories. The country comprises of 18th integral regions with a total area of 248,573 square miles. The capital of France is Paris.

France shares the border with Netherland, Spain, Andorra, Italy, Monaco, Switzerland, Germany, Luxembourg, and Belgium in Europe and Brazil and Surinam in South America. The total population of the country is 67.41 million people. Nice, Lille, Bordeaux, Toulouse, Marseille, and Lyon are some of her main urban areas.

France has a long history that dates back to the Iron age and the Gauls were the first inhabitants of the country. King Philip Augustus laid the foundation of a strong French Empire in the middle ages. The 1789th French Revolution ended the absolute monarchy and established the French First Republic. The Fifth French Republic came into existence in 1958 under the leadership of Charles De Gaulle. The country freed all the French colonies by the end of 1960.

Today, we’ll discuss the pestle analysis of France. Here we’re going to focus on the macro-environmental factors of the world’s leading economy. Here’s the pestle analysis of France as follows;

Political factors impacting France

Role in Europe

France performs a significant role in international politics and the western world. She’s also a key and a leading player in the European Union. Most importantly, she has permanent membership at the security council of the UN and founding member of the United Nations.

Diplomatic Alliances

France has established very good relationships with the USA. Many experts say that the growing relationship between Germany and France would question the leadership of the US in global affairs. The country has a very conflicted and troublesome history with the UK, but both countries have buried the hatches and developed good relations with each other.

Politically Stable

France has a stable political environment and she follows the semi-presidential system of government. She experienced some protests and processions over the law and order situation. Such events have disturbed the country’s business environment. Many investors started to lose confidence in her.

Terrorist Threats

France faced terrorist attacks in 2020, 2016, and 2015 and the government has become very cautious about the country’s security system since then. Now some politicians are thinking of depriving the terrorists of citizenship as counterterrorism measures. 

Economical Factors Affecting France

Industry

France makes a significant contribution to the European economy and she’s one of the world’s top 10 economies. However, she’s excellent in the production of luxury and cosmetic products. Her service industry is also the world’s leading. She’s a global leader in the industries like railway, automotive, and aerospace.

High GDP

According to an estimate, the nominal annual GDP (Gross Domestic Product) of France in 2020 was 2.551 trillion US dollars and it’s 7th world’s highest. Out of which, her per-capita income was 39,257 dollars and it’s 20th world’s highest. The drop in annual GDP and per capita income was due to the economic lockdown and economic crisis.

Trade Partners

France has trade alliances with organizations like OECD, WTO, NATO, and G7. Out of all her trading partners, Germany is her closest. Air France, JCDecaux, Veolia Environment, Areva, PPR, LVMH, Carrefour, EDF, L’Oreal, and AXA are some of the leading multinational French companies.

High Taxes

France is one of those countries that impose very high taxes. But the government decreased the corporate tax rate to 25%, 27.5%, and 26.5% due to the pandemic of covid-19. The government has also dropped the income tax rate from 14% to 11%. It’s worth mentioning it here that the French government charges different tax rates on personal income and corporations depending upon their earnings.

Social factors impacting France 

Modernism

France is the world’s most developed and modern country. Approximately more than 67.41 million people are populating the country. The average life of men and women is 78 and 85 years old. Other than the French language; French culture, cars, perfumes, fashion, and cousins are also famous worldwide. Most importantly, many people learn French as a foreign language and it ranks at the 2nd position of learning foreign languages. The lifestyle and standard of living of French people are very high.

Social Issues

France is also facing some social challenges like increasing unemployment, protests, procession, strikes, increasing crime rate, and labor issues. The unemployment rate of France in 2021 is 10.168%. Many people resent the idea of immigration. There have been some incidents of racial violence in the country.

Trends

French people are very cautious about their health and riding a bicycle is their preferred mode of transportation. The majority of the old school people still love to smoke and the others are converting to electronic cigarettes. Many people buy fitness equipment to get themselves in better shape.

Technological Factors Affecting France

Tech Advancement

France is the world’s top technologically developed country and it has a strong history in space technology, IT, and many other fields of science. She launched her first satellite into space over 50 years ago and it made the 3rd nation to have her satellite after the US and Russia.

Internet Access

France is the world’s highest user of the internet and she’s competing with other developed countries. Paris has some of the world’s leading startup companies and venture capital. However, the country is still facing a shortage of skilled computer engineers.

Research & Development

France is one of those countries that spend a plethora of resources on research and development in many fields. It doesn’t mean that the government provides the funding to the French National Research Agency. The money goes to research organizations, universities, and institutes.  

Legal factors impacting France

Regulations

A working week legally comprises 35 hours in France. The employees have to take a break during working hours, and the max continuous working hours are 4.5 hours. French laws and regulations have separate provisions for sabbatical leaves, paternity leave, maternity leave, sick leave, annual leave, and overtime working time.

Environmental factors affecting France 

Tourism Industry

Millions of tourists visit France annually and the French tourism industry adds billions of dollars to the country’s revenue. Some of her beautiful places are Brittany, Chamonix Mont Blanc, Provence, Mont Saint Michel, Cote D’Azur, Palace of Versailles, Louvre Museum, and the Eiffel Tower.

Environmental Challenges

France has achieved economic growth and progress at the cost of environmental challenges that many tourists and residents have experienced. Some of those issues are erosion of biodiversity, noise pollution, household waste, natural disasters, water pollution, and air pollution.

Conclusion: France PESTLE Analysis Example Country

After an in-depth study of the pestle analysis of France, we’ve concluded that France is undoubtedly the key player in the global market. Environmental challenges, an increasing unemployment rate, and terrorist attacks are severe threats to the country. France should address these issues and keep them under control; while paying heed to the external political, economical, social, technological, legal, and environmental factors impacting the country.