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Cross-border
economic
development 52 Cross-cutting themes in cross-border economic development
Attractiveness and competition
France suffers from a clearly established lack of competitiveness vis-à-vis
its neighbours along its northern and eastern borders, from Dunkirk to
Geneva, where daily cross-border flows are highest. The French territories
are disadvantaged in terms of per capita GDP and the employment
rate. Outflows of cross-border workers are a visible consequence of
this situation. Compared to their neighbouring counterparts, French
SMEs are less competitive and less open to international markets.87
Ì Ì The Euler Hermes “Export Barometer” shows that the number
of exporting French SMEs dropped from 120,000 to 95,000 from
2002 to 2012, i.e. a 20% fall in ten years, while Germany had
350,000 exporting SMEs in 2012, i.e. 3.7 times more than France.
SMEs, which represented 75% of exporting French firms in 2010,
accounted for only 61% of the latter in 2012. The stickiness of the
production system is unfavourable in a context of heightened global
competition; the lack of competitiveness is particularly evident at France’s
borders. While this points to the need for reforms, such reforms are not
the focus of this paper, but rather a guiding contextual element that
should be borne in mind.
87 P Veltz, La grande transition, Seuil, 2008.
The issue of the competitiveness of the French economy, which
has galvanised academic, economic and political debate since France
entered into a cycle of weak/zero growth and rapidly rising unemployment
at the end of the 2000s, has been analysed in many reports 88 identifying
the strengths and weaknesses of France’s production system and
recommending short- and medium-term government policies to restore
economic growth and boost employment. In these reports, the French
economy’s lack of competitiveness is mainly apprehended through the
deterioration of the industrial sector: in terms of the share of industry –
excluding construction – in total value added, France ranks 15th out of
the 17 euro area economies.89 This industrial decline is due both to price
(wage rises that outpace increases in productivity, a strong euro) and
non-price factors (production in the mid-range segment, output that is
little differentiated from competitors). Comparisons with neighbouring
Germany regularly highlight this lack of competitiveness.
88
89 Pacte pour la compétitivité de l’industrie française (The “Gallois Report”), 5 November 2012,
p.9.
The Greater Geneva area