With 1,194 projects announced, representing nearly 40,000 jobs, in 2023 France retained the first place in Europe for the reception of foreign investment, and this for the 5th consecutive year, revealed the EY 2024 barometer of the attractiveness of France. A few days later, the 7th edition of the "Choose France" Summit, which has become an essential annual economic event on the agenda of international investors, confirmed the trend. "Choose France" reached a record level of announcements this year with 56 investment projects representing a total amount of 15 billion euros, an increase of 2 billion compared to last year.
These positive foundations, however, are failing to erase the current economic gloom. In May 2024, the business climate in France remained mostly stable compared to April, but it decreased by 1.2% year-on-year. Calculated from the responses of business leaders in the main market sectors, the index stands at 98.5, just below its long-term average (100). "The improvement of the business situation in services offsets the degradation in retail trade and, to a lesser extent, in manufacturing industry and wholesale trade," says INSEE.
The month of May is traditionally a period where outstanding annual leave is used up, to which this year has been added the occurrence of several public holidays falling on working days. A dual phenomenon that may have contributed to a slowdown in activity, for example in industry and construction. "In industry, the downturn was more pronounced for the automotive, rubber, plastic products, machinery and equipment, and metallurgy sectors. It is less pronounced in those of pharmacy, the agri-food industry, and electrical equipment," points out the monthly business survey of the Banque de France for the month of June.
Under these conditions, road transport prices in France show a rather remarkable increase since it amounts to 0.8% month-on-month. The word "remarkable" can be used for several reasons. Firstly, this increase comes after a long downward trend that began in the last quarter of 2023 and was confirmed during the first 4 months of 2024. Then, in its latest estimates, the Banque de France only expected very slight GDP growth in the 2nd quarter, with a variation currently estimated between 0% and 0.1%. In addition, this would be mainly based on an increase in activity in sectors with small volumes of goods to transport. Worse, the Banque de France expects a decline in value added in the manufacturing industry, the slight increase in production in April being followed by a sharp deterioration in May. Finally, the 0.7% drop in diesel prices in April, which is reflected in the following month prices, made it logical to predict a downward impact on transport prices in a range between 0.1% and 0.3%, taking into account the weighting of fuel in the total cost price (...)