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France - Country Profile

France is in the midst of transition, from a well-to-do modern economy that has featured extensive government ownership and intervention to one that relies more on market mechanisms. The government has partially or fully privatized many large companies, banks, and insurers. It retains controlling stakes in several leading firms, including Air France, France Telecom, Renault, and Thales, and is dominant in some sectors, particularly power, public transport, and defense industries. The telecommunications sector is gradually being opened to competition. France's leaders remain committed to a capitalism in which they maintain social equity by means of laws, tax policies, and social spending that reduce income disparity and the impact of free markets on public health and welfare. The government has lowered income taxes and introduced measures to boost employment and reform the pension system. In addition, it is focusing on the problems of the high cost of labor and labor market inflexibility resulting from the 35-hour workweek and restrictions on lay-offs. The tax burden remains one of the highest in Europe (43.8% of GDP in 2003). The lingering economic slowdown and inflexible budget items have pushed the budget deficit above the eurozone's 3%-of-GDP limit. Finance Minister Herve GAYMARD has promised that the 2005 deficit will fall below 3%.


Economic Statistics
Exports : $419 billion f.o.b. (2004 est.)
Export
Commodities :
machinery and transportation equipment, aircraft, plastics, chemicals, pharmaceutical products, iron and steel, beverages
Export
Partner
Germany 15%, Spain 9.5%, UK 9.3%, Italy 9%, Belgium 7.2%, US 6.7% (2004)
Imports $419.7 billion f.o.b. (2004 est.)
Import
Commodities :
machinery and equipment, vehicles, crude oil, aircraft, plastics, chemicals
Imports
Partners :
Germany 19.2%, Belgium 9.9%, Italy 8.8%, Spain 7.4%, UK 7%, Netherlands 6.7%, US 5.1% (2004)