How Would You Characterize The Shift In French Attitudes And Policies Towards Foreign Direct Investment? What Do You Think Has Driven The Change In Attitudes And Policies?

The French has always been somewhat ambivalent toward foreign direct investment. In the 1960s and 70s successive French governments used a mixture of socialist and nationalists rhetoric to spurn foreign investment proposals by companies such as General Motors. These governments took the view that direct investment by foreign multinationals companies would damage the French economy. Government officials believed strongly in the need for France to build its own indigenous companies.

They argued that the economic power enjoyed by foreign multinational gave them the ability to dominate any markets they entered at the expense of locally grown enterprises. Successive socialists governments in France expressed a decisive socialist governments in France expressed a desire to control economic activity through extensive planning and the multinationals of private business. Letting foreign multinationals into the country was through to be inconsistent with this goal.

France's policy toward inward foreign direct investment began to change in the early 1980s. Although France's socialists President Francis Mitterrand remained suspicious of direct invest by foreign firms, his successive administrations reduced the bureaucratic obstacles to foreign investment and created a more coherent mechanism for luring inward investment. The change in policy reflected the growing realization that inward investment could have substantial benefits for the French economy.

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