France became the leading destination for international investment in Europe at the end of 2019

According to a recent report of EY (« EY European Investment Monitor 2020 »), France, at the end of 2019, became the leading destination for international investment in Europe.

With 1197 projects in the works in 2019, France overtook the United Kingdom (1109) and Germany (971) for the first time. It held the top spot for production and R&D, in line with the strong growth of 2017 and 2018.

In terms of percentage compared to 2018, the increase in terms of number of projects is the following: +17% for France, +5% for the United Kingdom and +0% for Germany.

According to EY annual « Perception » survey, conducted
in February 2020, 32% of business leaders thought France was
becoming more attractive, and 50% believed it was stabilizing despite the social unrest of 2018 and 2019.

However, it is certain that the current Covid-19 pandemic has already and will continue to have strong impact on the decisions of the investors. Indeed, according to a survey made by EY in April 2020 among 113 international business leaders, some 65% of announced French 2019 investments are still in place, 25% postponed or substantially revised, and 10% cancelled.

According to a second survey conducted by EY between April 20 and 30, 2020, 66% of business leaders were
contemplating a minor or major reduction in their
projects in 2020, and 15% a postponement until 2021.
However, none of them mentioned cancellation.

In this connection, it has to be recalled that on March 26, 2020, the European Commission issued guidelines for EU Member States on foreign direct investment. The guidelines urge Member States to make full use of, in this time of crisis, their investment screening mechanisms to address cases where the acquisition of European companies by investors from outside the EU would create a risk to the EU’s security and public order.

The guidelines encourage Member States to screen direct investment from outside the EU in particular areas such as medical research, biotechnology and infrastructures as they are essential for the EU’s security and public order.


See also