The industrial revolution in France took part later in the 19th century, and it was associated with slow growth compared to the growth in industrialization in other European nations. France has always relied on the Agriculture sector for the growth in GDP.
While modern France has seen tremendous growth in the industrial sector, agriculture is still one of the most important economic activities for the generation of revenue for the government. The major agricultural regions in France include the North-Western region, where there are fertile soils and reliable rainfall. The central part of the nation is not fertile, which makes it appropriate for other economic activities like manufacturing.
Over the years, France has developed an advanced mining industry, which produces coal, bauxite, and iron, among many other minerals. The industrial sector in the company is also characterized by the development of machinery, automobiles, aircraft, and electronics among many other technological products. The tourism industry in France has also traditionally been one of the sources of revenue for the government. France has many natural and man-made types of scenery that attract visitors from different parts of the world. The diversity in economic activities in France has helped the nation to increase its gross domestic product (GDP), and it is currently one of the most economically developed nations in the world.
France is the second-largest economy in the Eurozone, and it ranks seventh in the world. Since the 1950s, the growth rate of the GDP of the nation averaged 0.79% annually, and the highest growth rate recorded was 7.7% in 1968. France had a GDP of $2829.19 billion in 2014, and it experienced a 1.1% growth in GDP in 2015 (France GDP 2016). It is apparent that the GDP from the service industry had the highest contribution to the national GDP. The manufacturing and agriculture industries also had significant contributions to the national GDP.
The third quarter of 2015 recorded 111.32 index points in France, and it increased to 111.66 Index points in the fourth quarter. This is the highest growth in productivity recorded since 1950 in the nation. The unemployment rate in the nation was 10.30% in the fourth quarter, which was a 0.1% decrease from the third quarter of 2015. There was no significant change in the cost of labor in France in 2015, but there was a wage growth of about 0.2% (France Productivity 2016).
The highest inflation rate recorded in France since 1950 was 18.8% in 1958, and the lowest inflation rate was -0.7% in 2009. Current data reveals that the inflation rate in France was 0.51%, and there was a slight decrease in this value in 2015. The cost of energy and manufactured products has been decreasing in the economy, whereas the cost of food products has remained the same over the past several years. The cost of services has also been stable (France Inflation Rate 2016). France has been notorious for incurring a high budget deficit in the Eurozone, and the concerned authorities have compelled the French government to work toward attaining fiscal stability by maintaining a deficit below 3% in the future (Spiegel, Politi & Brunsden 2015).
France is one of the most attractive economies for foreign direct investors. In 2014, Business entities in the European region made up 61% of the FDIs in France, and the majority of the companies were in the manufacturing industry. 21% of the entities were from North America (France Foreign Direct Investment 2016). The FDIs create jobs in France, and they are responsible for a significant amount of the revenue generated in the economy. Over the past two decades, the education system in France has been criticized for failing to provide a modernized approach in various disciplines and the production of lowly performing students.
There are numerous elites in the nation, but there are more inadequately educated members of the society, and this has led to a high coefficient of social inequalities in France (French Education System Slammed by OECD 2010). According to the GCR survey 2015, France enforces its microeconomic laws quite strictly, and it has received a full score regarding the efficiency of the France Competition Authority. The agency issued fines worth more than one billion Euros in 2015 to companies that failed to implement the law appropriately (France’s Competition Authority 2016).
Over the past fifty years, France has seen tremendous growth in its economy. The nation has particularly attained its current position as the second-largest economy in the Eurozone by diversifying investments in various industries.
The industrial revolution process in France took place gradually, which made the nation highly reliant on the agricultural sector for revenue generation. Currently, the service industry accounts for the highest contribution to the national GDP in France. The macroeconomic and microeconomic principles in the nation have been articulated to facilitate low unemployment and inflation rates while increasing the GDP steadily. The nation is facing challenges in attaining financial stability and enhancing the quality of its education system.
List of References
France GDP 2016. Web.
France Productivity 2016. Web.
France Inflation Rate 2016. Web.
France Foreign Direct Investment 2016. Web.
French Education System Slammed by OECD 2010. Web.
France’s Competition Authority 2016. Web.
Spiegel, P, Politi, J & Brunsden, J 2015, France Slams European Commission on budget deficit warning. Web.