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Economic and political overview

Economic Overview

France is ranked as the world’s seventh-largest economic power (IMF, 2026). In 2025, France's GDP grew by 0.8%, after 1.5% in 2024. Household investment stabilised (-0.2%) after high interest rates and low confidence drove a 9.8% decline in 2024. Business investment edged back up 0.4% despite low capacity utilization and weak demand. Public support faded, with collective public consumption falling (-0.3%) and public investment slowing (+2.6%). In 2025, a contractionary fiscal stance was the main brake on activity (INSEE). Private investment remained weak due to the delayed impact of accommodative monetary policy and ongoing economic uncertainty. Private consumption benefited from disinflation and rising real wages. In 2026, economic activity is projected to hold steady, with GDP growth reaching 0.8% before picking up to 1.1% in 2027, supported by lower fiscal adjustments and falling credit costs. Growth will be driven by net exports, notably aeronautics and defence, as higher energy prices weigh on real disposable incomes and private consumption stays subdued.

Concerning public finances, the fiscal deficit was estimated at 5.1% of GDP in 2025, down from 6.1% in 2024. Announced fiscal consolidation measures for 2025 amount to 1.4% of GDP, but projections assume a lower effort, with a structural adjustment of the primary balance of 1% of GDP in 2025 and 0.5% in 2026 (data OECD). In 2026, the general government deficit is projected to reach 5.1% of GDP, before widening to 5.7% in 2027 as some revenue measures are set to expire. The revenue-to-GDP ratio is expected to decline by about ¼ pps, while the expenditure ratio will decrease only slightly. Interest payments are forecast to rise by 0.3 pps. After years of increase, public debt was estimated at 115.6% of GDP in 2025. It is expected to continue increasing gradually, reaching 118.1% in 2026 and 120.2% in 2027 (EU Commission). This rise is primarily driven by high primary deficits and growing interest payments, while the debt-reducing effect from nominal growth is anticipated to be more moderate than in previous years. Inflation fell further in 2025, averaging 0.8% over the year, primarily driven by lower energy and food prices, along with a slowdown in services prices. A marked increase is expected in 2026 due to base effects and an energy price shock. Energy price growth is forecast to drive headline inflation up in 2026, reversing the electricity price declines recorded in 2025. Average inflation came in at 0.9% in 2025, rising to 2.4% in 2026 before easing to 1.8% in 2027, returning to the ECB target.

The labour market held up in 2025 but deteriorated through 2026. The unemployment rate rose by 0.2 percentage points to 8.3% in Q2 2026, well above its 2008 low, while payroll employment fell by 0.2% over 2025. According to data from INSEE, in Q2 2026, the unemployment rate for France excluding Mayotte reached 8.3%, after 8.1% in the previous quarter and 7.5% one year earlier. Payroll employment is expected to keep falling in 2026 (-0.4%, after -0.2% in 2025) as the impact of apprenticeship contracts diminishes, hours worked return to 2019 levels, and labour productivity recovers. The unemployment rate is projected to rise further to 8.3% in 2026 and 8.7% in 2027, after 7.7% in 2025 (EU Commission). On average, French citizens enjoy a high GDP per capita (PPP), estimated at USD 63,975 in 2025 by the World Bank. Nevertheless, inequalities persist and according to Eurostat 18.6% of the population was at risk of poverty or social exclusion in 2025 (slightly above the EU average of 17.1%).

 
Main Indicators 20252026 (E)2027 (E)2028 (E)2029 (E)
GDP (billions USD) 3,368.933,596.093,672.073,775.713,888.62
GDP (Constant Prices, Annual % Change) 0.90.90.91.21.2
GDP per Capita (USD) 48,93052,08353,03554,37955,849
General Government Balance (in % of GDP) -5.1-4.9-4.8-4.3-3.8
General Government Gross Debt (in % of GDP) 116.0118.4120.5121.1121.3
Inflation Rate (%) 0.91.81.71.91.9
Unemployment Rate (% of the Labour Force) 7.67.97.97.77.5
Current Account (billions USD) -14.82-12.05-7.488.3913.66
Current Account (in % of GDP) -0.4-0.3-0.20.20.4

Source: IMF – World Economic Outlook Database , Latest data available

Country Risk

See the country risk analysis provided by La Coface.

 

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Main Sectors of Industry

France is the largest agricultural power in the European Union, accounting for almost one-fourth of the EU’s total agricultural production. Nevertheless, the agricultural sector only represents a very small part of the country's GDP (1.3%) and employs 3% of the population (World Bank, latest data available). Wheat, corn, meats and wine are France's main agricultural products. The number of French farms has been divided by four in fifty years: there were more than 1.5 million in 1970, whereas nowadays they are less than 400,000, with an average farm size of 69 hectares. France dominates the global wine industry as the largest producer—accounting for roughly 20% of world output at around 48 million hectoliters annually—and stands as a top exporter with export revenues in the billions (EUR 15.6 billion in 2024). INEE’s first estimates for 2024 agricultural accounts indicate a 7.5% decline in production, driven by lower prices and volume. Crop production was expected to drop 6.8% in volume due to adverse weather, with prices falling by 6.8%, leading to a 13.1% decrease in crop value. Animal production decreased by an estimated 1.4%, with prices dropping 2.3%, partly offset by a slight volume increase of 0.9%. Intermediate consumption was forecast to fall by 8.0%, with a price drop allowing for a slight volume recovery. As a result, gross value added per worker in real terms declined by 7.7% in 2024, following a 9.6% decrease in 2023.

France's manufacturing industry is highly diversified; however, the country is currently undergoing a de-industrialisation process, which has resulted in the outsourcing of many activities. Nowadays, industry represents 16.8% of GDP and employs almost a fifth of the active workforce (World Bank). While services dominate the French economy, industry remains crucial. Traditional powerhouses like aerospace (Airbus), automotive (Peugeot, Renault), and luxury goods (LVMH) thrive alongside food & beverage (renowned cheeses, wines) and chemicals/pharmaceuticals (Sanofi). Emerging sectors like digital industries, renewable energy, and green industries are gaining traction with government support. Competition, rapid technological change, and stricter environmental regulations pose challenges, but France's industrial sector, rich in innovation and manufacturing expertise, is well-positioned to adapt and remain a global force. According to official preliminary figures, French manufacturing output in the fourth quarter of 2024 was 1.9% lower than in the same period of 2023, while production across all industries was 1.2% lower.

The tertiary sector represents 70.9% of the French GDP and employs 78% of the active workforce (World Bank). France is the leading tourist destination in the world: in 2024, over 100 million international visitors visited the country (+2 million y-o-y), generating around EUR 71 billion in international revenue (+12% - data Ministry of Economy). According to the European Banking Federation, financial activities made up 3.2% of total value added in France in 2023, with around 60% attributed to the banking sector. The banking industry employed 355,100 people by the end of 2023, with 326 banks operating within the industry, of which four are recognized by the Financial Stability Board as part of the eight Euro area Global Systemically Important Banks (G-SIBs).

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 2.33 19.34 78.33
Value Added (in % of GDP) 1.40 16.78 70.85
Value Added (Annual % Change) 6.95 -0.62 0.85

Source: World Bank - Latest available data.

 
Monetary Indicators 20212022202320242025
Euro (EUR) - Average Annual Exchange Rate For 1 USD 0.850.950.920.920.88

Source: World Bank - Latest available data.

 

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Foreign Trade

France is a major actor in global trade, with trade representing 67% of its GDP in 2025 (World Bank). According to data from Comtrade, France’s exports in 2025 were led by aircraft and spacecraft (5.1%), medicaments (4.9%), turbojets and gas turbines (4.2%), motor cars (3.5%), and jewellery (2.4%); whereas imports mainly comprised motor cars (5.3%), refined petroleum oils (3.7%), crude oil (3.5%), medicaments (3.0%), and petroleum gas (2.8%). Aerospace exports continued to recover in 2025 (+18.3%, to EUR 68 billion), exceeding their 2019 record. Exports of pharmaceuticals rose by 8.7%. The energy bill fell by 15.7% to EUR 71.8 billion in 2025, mainly due to lower natural gas and refined petroleum prices (data French Customs).

In terms of countries, the main export destinations in 2025 were Germany (13.4%), the United States (8.1%), Italy (7.9%), Spain and Belgium (7.5% each), and the United Kingdom (6.4%), with imports coming chiefly from Germany (12.4%), China (10.5%), the U.S. (7.9%), Italy (7.8%), Spain (6.5%), and Belgium (6.4% - data Comtrade). U.S. tariffs weighed on French exports to the United States in the second half of 2025: excluding aerospace, they fell by 13% year-on-year in Q4 2025, with sharp drops for spirits (-47%), wines (-39%), and perfumes and cosmetics (-25% - French Customs).

France registers a strong structural trade deficit. Nevertheless, while the goods balance is structurally in deficit as the country is a net energy importer, the services balance is in surplus thanks to tourism revenues. According to WTO data, in 2025, France exported goods with a total value of USD 683.1 billion (+6.6% y-o-y), while it imported USD 786.4 billion (+4.6% y-o-y). As for the services, France exported around USD 428.6 billion (+6.5% y-o-y), while imports stood at USD 370.0 billion (+8.4% y-o-y). The overall trade balance was estimated to be negative by 0.4% of GDP by the World Bank (from 0.3% one year earlier). According to the latest data published by the French customs authority, in 2025, CIF imports rose by 0.7% to EUR 703.6 billion, after two years of decline. The rise in manufactured goods imports (+2.9%), notably aerospace (+24.6%) and pharmaceuticals (+14.4%), outweighed the fall in energy imports (-15.7%). Exports increased by 2.5% to EUR 614.7 billion, mainly due to higher volumes. The growth was driven by aerospace and pharmaceuticals, while the agri-food surplus fell to a historic low of EUR 0.2 billion; the trade deficit stood at EUR 88.9 billion on a CIF/FOB basis (EUR 69.2 billion FOB/FOB).

 
Foreign Trade Values 20212022202320242025
Imports of Goods (million USD) 715,082823,216788,177751,836786,434
Exports of Goods (million USD) 585,021620,461651,122640,518683,095
Imports of Services (million USD) 269,102292,343331,855341,459369,973
Exports of Services (million USD) 316,398364,052374,547402,666428,637

Source: World Trade Organisation (WTO) ; Latest available data

Foreign Trade Indicators 20212022202320242025
Foreign Trade (in % of GDP) 63.876.070.668.167.2
Trade Balance (million USD) -77,149-141,658-84,706-65,033-65,531
Trade Balance (Including Service) (million USD) -30,255-70,150-41,937-3,822-6,776
Imports of Goods and Services (Annual % Change) 8.39.0-0.3-1.22.9
Exports of Goods and Services (Annual % Change) 11.39.12.52.51.3
Imports of Goods and Services (in % of GDP) 32.539.336.234.233.8
Exports of Goods and Services (in % of GDP) 31.336.634.533.933.4

Source: World Bank ; Latest available data

Foreign Trade Forecasts 2026 (e)2027 (e)2028 (e)2029 (e)2030 (e)
Volume of exports of goods and services (Annual % change) 2.72.22.52.32.2
Volume of imports of goods and services (Annual % change) 1.21.82.22.22.1

Source: IMF, World Economic Outlook ; Latest available data

Note: (e) Estimated Data

 
International Economic Cooperation
France is a member of the following international economic organisations: ICC, European Union, WTO, European Economic Area, G-5, G-7, G-8, G-10, G-20, IMF, OECD, among others. For the full list of economic and other international organisations in which participates France click here. International organisation membership of France is also outlined here.
Free Trade Agreements
The complete and up-to-date list of Free Trade Agreements signed by France can be consulted here.
 

Main Partner Countries

Main Customers
(% of Exports)		 2025
Germany 13.4%
United States 8.1%
Italy 7.9%
Spain 7.5%
Belgium 7.5%
See More Countries 55.6%
Main Suppliers
(% of Imports)		 2025
Germany 12.4%
China 10.5%
United States 7.9%
Italy 7.8%
Spain 6.5%
See More Countries 55.0%

Source: Comtrade, Latest Available Data

 

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Political Outline

Current Political Leaders
President : Emmanuel Macron (since 14 May 2017; re-elected for a second term on 24 April 2022)
Prime Minister: Sébastien Lecornu (since 9 September 2025)
Next Election Dates
Presidential elections: April 2027
Senate: September 2029
National Assembly: June 2029
Main Political Parties
Following the 2024 elections, the main parties represented in the French parliament are:

- National Rally (RN): far-right; first parliamentary representation in 1997. Ran independently and emerged as the leading party in terms of votes
- Renaissance (formerly known as La République En Marche): centre, liberal political movement founded by Emmanuel Macron
- La France Insoumise (Unbowed France - LFI): far-left
- The Socialist Party (PS): centre-left, social democratic party that advocates for social justice, equality, and solidarity
- The Republicans: center-right party founded in 2002. Its deputies sit in the Droite Républicaine group, the fifth-largest in the National Assembly with 48 members. The party is generally considered Gaullist, supporting a strong French state and national identity
- The Democratic Movement (MoDem): centrist
- The Ecologists - Europe Écologie Les Verts (EELV): emphasises ecology and peaceful and sustainable lifestyles
- Horizons (HOR): centre-right
- Union of the Right for the Republic (UDR): conservatism, right-wing populism
- French Communist Party (PCF): communism, soft euro-scepticism

President Emmanuel Macron’s centrist Renaissance maintained an alliance with the MoDem to consolidate the center ground. On the left, a coalition known as the New Ecological and Social People's Union (NUPES) was formed in 2022, comprising parties like LFI, PS and EELV.

Executive Power
The President of the Republic is the Head of State. He/She is elected by direct universal suffrage for five years. He/She appoints the Prime Minister and his/her Government at the suggestion of the Prime Minister. The Prime Minister sets the amount of the State's expenses and revenue and prepares some bills.
Legislative Power
The parliament is composed of the Senate and the National Assembly. The 348 senators are elected by indirect universal suffrage for six years, renewable by half every three years. The 577 deputies (MPs) are elected by direct universal suffrage. They examine bills and private bills successively, vote laws and monitor the Government. The economic, social and environmental council has an advisory function (optional or compulsory) within the framework of the legislative process.
 

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