INVEEST: “France Relance” in four questions

Unveiled on September 3, 2020, the post-COVID recovery plan for the French economy, France Relance, aims at constituting the basis of the French economy by 2030. How will the industrial sector look like in the future? What transformations will the investment of over 35 billion euros in this sector bring about? Below you will find an overview of the measures in favor of the industrial sector, the projects fostered by France Relance as of today, and what this “new deal” means in terms of ecological transition.

What are the key features of the industrial component of France Relance?

In line with the solidarity funds set up during the crisis, one of the key components of the recovery plan to boost competitiveness consists in strengthening the equity funds of SMEs. Through a “France Relance” label, a public budget guarantee may be granted to financial investments and funds deemed “most relevant to a sustainable recovery of the economy”.

France Relance also emphasizes the need to invest in new technologies, such as carbon-free energies. The Program “Investissement d’avenir” will offer 11 billion euros by 2022 to support these innovations. The 1.2 billion euros “Industrial Decarbonization” fund will also contribute to the development of these innovations.

There is in fact a very large spectrum of funds available, all listed here.

Where are we at with the initiatives and investments launched in 2020?

As of today, over 30 industrial projects in the health, agri-food, electronics and 5G sectors have been selected by the government. In total, they will benefit from 140 million euros and are expected to create over 1,800 direct jobs, all supported through public funding.

As far as industrial decabornization is concerned, 16 projects across the country were selected by the end of 2020. They represent a total investment of 291 million euros, out of which 61 million euros will be supported by the French State. Their implementation will reduce CO2 emissions by 237,000 t CO2/year, that is 10% of targeted sites’ emissions, on average.

The new calls for projects to promote industrial decarbonizarion will be launched in the first quarter of 2021, including one focusing specifically on energy efficiency.

As far as smaller companies are concerned, the subsidies for energy efficient projects under 3 million euros can represent a valuable help.

How can this recovery plan boost ecological transition?

France Relance will allocate 35 billion euros to the industrial sector. These investments should be used to promote environmentally friendly projects, allowing for an economic recovery from the COVID crisis, as well as the structural changes required to operate a successful ecological transition.

This crisis and recovery plan should be an opportunity to use resources and address environmental challenges through sustainable solutions, in line with the the EU’s goal to be climate-neutral by 2050

Why is this an asset to companies’ long-term development?

Undertaking its energy and ecological transition certainly means investing, but ultimately results in economies of scale – since de facto production is, for example, more energy-efficient and therefore more efficient. These green leverages, long considered useless to defining priority investments, can in fact strengthen businesses’ competitiveness and resilience. Companies with real sustainable development strategies have proved more resilient to the crisis. And the more environmental issues change our habits, the more sustainable development will become mandatory for industrial companies.

The ecological transition is a great opportunity for the industrial sector: for its modernization and its future. While it used to be considered as a source of risk only, environmental aspects, when assessed appropriately, may transform into a competitive advantage.

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