The Strategic action plan for economic diplomacy is common to the Ministry of Foreign Affairs and the Ministry of the Economy and Finance. This is so as the Action Plan aims to enhance cooperation between government departments and hence the collective effectiveness of government action.
An interministerial agreement has therefore established a unique interministerial action plan for all embassy services, to be implemented under the authority of the Ambassador who will head the “French export team”. In addition, each embassy action plan will be monitored and assessed by means of a single process common to both ministries.
Moreover, the SME support function has been entrusted to Ubifrance. The Agency is present in 60 big countries where there is generally a solvent market to support internationalization of businesses. In countries where Ubifrance is not present, this function is exercised directly by ambassadors and their staff.
Private Sector Aid Fund – Emerging Markets Reserve (FASEP RPE)
Support for French corporate investment in emerging and developing countries.
French firms have recognized expertise in establishing and operating public infrastructure critical to a country’s development, such as water and sanitation, public transport, energy, agriculture, etc.
France’s Project Subsidy Policy
The Réserve Pays Émergents (RPE) [Emerging Markets Reserve], previous financial protocols, and the Fonds d’Étude et d’Aide au Secteur Privé (FASEP) [Private Sector Study and Aid Fund] are designed to benefit developing countries, in particular emerging countries, with French industrial know-how and engineering (large groups and SMEs).
These two instruments, implemented by the Treasury Directorate General [Ministry of the Economy and Finance, ]are posted as French Official Development Assistance (ODA). As such, they meet the guidelines adopted for French aid, with an emphasis on sustainable development.
As the projects’ appropriation principle is crucial to their proper operation, the RPE and FASEP are mobilized to meet the needs prioritized by recipient countries in their national development strategies. Mobilizing these tools is only envisaged on the basis of a request from recipient countries.
The RPE is designed to provide support for some 20 emerging countries in the form of concessional loans for implementing their development projects. French financial aid is granted on the basis of a detailed review of each project including a preliminary assessment by an independent expert.
Since 2000, the RPE has supported 70 projects for a total amount of €3.2 billion.
The FASEP operates by means of donations in a broader geographical area as some 60 countries are eligible, to assist local contracting authorities in conducting studies to prepare their infrastructure projects and investment policies. Since 2000, €260 million in donations have supported 400 services provided by more than 150 French companies in 55 countries.
FASEP example in Indonesia
Satellite monitoring of fishing activities
Indonesia has one of the largest fishing areas in the world and one of the biggest fishing fleets. Fishing is a central economic sector.
The project’s aim was to provide the Indonesian authorities with technical tools allowing them to meet the dual requirement of monitoring fishing activities in order to better use fishing resources, and of complying with international recommendations on monitoring of fishing vessels, particularly in combating illegal fishing.
With RPE financing (totalling €9.4 million), Indonesia received a “turnkey” monitoring system using Argos beacons and data processing software developed by Collecte Localisation Satellites (CLS) [a subsidiary of the French National Centre for Space Studies (CNES)]. 1,500 vessels have been equipped with beacons, a fishery monitoring centre has been established, and patrol boats have been equipped for interception. The rest of the Indonesian fleet is gradually being equipped.
Supporting export financing by means of State guarantees
More than 80% of world trade relies on financing in the form of credits and guarantees, mostly short-term. Public financing hence plays a key role in supporting exports.
France has introduced a number of subsidies in order to provide such support. Financing and support procedures have been revised and simplified (reform of Coface procedures, reform of Ubifrance and economic services, adoption of paperless foreign trade procedures, piggy-backing of SMEs by large groups, etc.).
On behalf of and with the guarantee of the State, Coface manages State guarantees intended to encourage and support international corporate development.
Each year, the Economy and Finance Ministry presents the credit insurance policy to exporters and banks. This credit insurance policy defines the credit capacity guaranteed by Coface on behalf of the State and covering export contracts for the coming year, based on the analysis of country financial risk estimates and the outlook for French export flows to those countries.
The Coface State Guarantees Directorate offers a wide range of insurance products that support French companies and the banks financing their operations throughout their export journey:
- market survey with the A3P first steps market survey insurance (Assurance prospection premiers pas – A3P)
- Credit insurance for the sale and financing of goods and services
Coface also offers solutions enabling businesses to secure guaranteed rates and pre-shipment financing with the Foreign exchange risk insurance and to submit bids in local currencies with the Exchange risk insurance.
Accompanying French businesses in their export schemes.
UBIFRANCE is the French agency for international business development in the form of an EPIC (public industrial and commercial institution established by the Economic Initiative Act of 1 August 2003 and placed under the supervision of the Ministry of the Economy, Finance and Foreign Trade).
The Agency’s mission consists in promoting the international development of French businesses by conducting or coordinating a variety of actions relating to information, training and promotion, and to technical, industrial, trade and international voluntary service cooperation.
UBIFRANCE accompanies businesses at each stage of their export development in identifying prospects and potential partners, organizing market survey, informing them about market access conditions and advising them on how to establish themselves locally.
UBIFRANCE services are divided into three categories: consultancy, communication and contact services.
The following UBIFRANCE objectives are summed up in the Charte nationale de l’exportation de juillet 2011 (National Export Charter, signed in July 2011):
- support the international development of 17,000 SMEs and intermediate-sized enterprises (ETIs);
- to achieve this objective, provide support services to 60,000 SMEs and ETIs, 70% of which are to be provided by UBIFRANCE alone;
- in terms of concrete results for employment, UBIFRANCE actions should lead to the development of 10,000 new business opportunities for the benefit of 6,000 SMEs and ETIs.
UBIFRANCE economic missions
The 2009 reform allocated UBIFRANCE new resources to cater for new ambitions, so that it has offices abroad since 1 January 2009. This has made it possible to gradually transfer the trading activities of (former) economic missions to UBIFRANCE.
By the end of 2012, the scope of UBIFRANCE extended to 56 countries (as against 28 in 2009).
UBIFRANCE offices operate as part of the coordinating and implementing mission carried out by Ambassadors as Heads of diplomatic missions, under Decree 79-433 of 1 June 1979 on the powers of ambassadors and the organization of State services abroad.
French International Internship Programme (VIE)
The French International Internship Programme (VIE) or International volunteering in companies,was established by Act No 2000-242 of 14 March 2000 on civil volunteering. It enables French companies to entrust young men and women aged 28 at the most with a professional mission abroad during an adjustable period of six months to two years renewable once within that time limit.
The administrative and legal management of international volunteering in companies (VIE) is delegated to UBIFRANCE. The VIE formula exempts companies from any direct contractual link (as the contract is signed between UBIFRANCE and the young volunteer).
Under its objectives, UBIFRANCE plans to recruit 15,000 volunteers (including 6,000 hired by SMEs and intermediate-sized enterprises (ETIs) for the period 2012-2014).