Market Opportunity
With the Euro, France’s unit of currency, remaining strong against the Dollar, and the continued deregulation of the French consumer market, France has become an increasingly attractive destination for US exports. France has the second-largest population in the European Union behind Germany, at around 64.5 million people. And with the highest fertility rate in Europe according to the CIA World Factbook, its growth rate remains relatively high. Additionally, the IMF ranked the French economy as the world’s eighth largest by purchasing power parity at $2,046 billion, with consistent, modest GDP growth over the last 5 years. And with a per capita income of around $33,800 France is home to consumers with strong purchasing power.
Entering the French market, similar to all others, is not without its challenges. Soaring food, energy, and property prices have slightly diminished French purchasing power in recent years, especially when coupled with rather static salaries caused by a short 35-hour work week. These trends have forced the middle class in France to spend on average between 20-25% of their expenditures on food and transport according to a recent New York Times article, and an April 2008 survey showed that retail sales have fallen to their lowest level in two years. However, the present government under Nicolas Sarkozy has made it its mission to correct the current inflationary cycle. He has already managed to increase the French minimum wage in both 2007 and 2008 and seeks further measures to decrease the price controls of French hypermarkets (giant centers that basically control the French retail market).

Best Vertical Markets
According to the CIA World Factbook, French imports from the US rose 8.1% to 24.2 billion in 2006, and they are up more than 25% since 2002. These are very promising figures for a business looking to enter the French market. Additionally, the US Department of Commerce finds that French direct marketing for consumer products and services is one of the largest markets in the world and one of the fastest growing in Europe, with a 17 percent growth rate in 2006. Ecommerce is also burgeoning in France, with retail online sales (B2C) in 2006 at 14.9 billion dollars. The vertical markets reporting the best growth in recent years include consumer electronics, computers, cameras, mobile phones, cultural products, and miscellaneous services (downloading, subscriptions, etc.)

Regulatory and Tariff Climate
On the tariff front, France adheres to the EU’s common external tariff for imports. Most raw materials enter the country duty-free, while French customs places a tariff of 5% to 17% on most manufactured goods. Potential importers to France must be wary of the regulations and standards imposed. Every article entering the country must be clearly marked with the country of origin, and its content must be labeled in French. In addition to the CE mark required on regulated products by the EU, France requires an NF mark to be displayed on regulated products offered for commercial sale in its market. Articles not marked clearly are subject to delays in customs and possibly may not be cleared for consumption. News on this front remains positive, as negotiations continue between the US and the EU on a Transatlantic Economic Council, aimed to reduce regulatory barriers between the two trade giants.

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