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Bain-AmCham Barometer 2009: Building a Bridge from Crisis to Growth
Barometer results: Optimism after the storm
Paris, November 19, 2009
American investors in France are more pessimistic than they have ever been since 1999, with only 11% of respondents believing that economic prospects are improving. Yet, a short and mid-term optimism is clearly expressed: 63% think the financial crisis is behind them or will be by the end of 2009. These findings are part of the tenth annual AmCham-Bain 2009 Barometer conducted by the American Chamber of Commerce in France jointly with the consulting firm Bain and Company. This year, the crisis is perceived as worse than what was expected after the 2008 Barometer. In 2008 39% of respondents anticipated that the economic situation would worsen in 2009. When asked in 2009, the number rises to 67% for the current year. This collapse follows a sharp fall in 2008 after the highest peak in 2007 (when 58% of respondents anticipated an improving economic situation).
Prospects for 2010-2011 are positive in the Barometer; yet, signals are still mixed. Only 19% of respondents believe the economic situation will worsen in 2010 and 2011. In 2009, 52% answered their workforce had been reduced in 2009. Only 16% expect to do so in 2010-2011. But while 45% expect an upturn in business, 42% felt more neutral about conditions after the crisis. The study also points to relatively safe business conditions in France compared to other markets. Four out of five believe that the French subsidiary of their group has suffered from the crisis. However, 83% regard their subsidiary as less impacted than other countries.
“Banking system reliability makes a noticeable entry on the top 5 of French assets,” said Jean-Claude Gruffat, Amcham Chairman, and CEO of Citibank. Overall, the Barometer shows criteria related to cost and procedure of layoffs are becoming more crucial, as well as banking system reliability. While France is highly valued for its Banking institutions, its labor regulations are seen as a weakness. But according to Bertrand Pointeau, Bain & Company partner and AmCham Treasurer: “It is encouraging to see that surveyed companies anticipate the end of the crisis earlier than predicted, even regarding employment.”
Other key facts from this year’s Barometer:
• After the French government has launched a stimulus plan in December 2008 (“le plan de relance 2008”)
- Eighty-four percent believe the nature of the measures taken “fits” or “perfectly fits” the crisis.
- For 76%, the scale of these measures is proportionate to the crisis.
- The relative attractiveness of France remains unchanged for 67% of respondents
• Seventy-seven percent see France on par or ahead on environmental policies compared to the others countries in the European Union
• Policies on agriculture, highways, CO2 emissions and transport are less appreciated than measures in favor of eco-friendly buildings, green tax policy, and sustainable energy
• The popularity of Barack Obama announced in the 2008 Barometer was confirmed
- 98% believe that his election will have a “positive” or very positive impact on the image of the United States in France
• 82% believe that Nicolas Sarkozy’s election has a positive impact on image of France in the United States
- One-in-three respondents thinks that business between France and the United States will be favourably influenced by relations between the two presidents
Full results available for download here: Barometer,_full_results_2009.pdf