I.  COMMERCIAL OVERVIEW

A. Overview of Import Market
France has the world's sixth largest economy and is the United States'
eighth largest trading partner.  The market for U.S. goods and services
in France has been and will continue to be of major importance in
industry, agriculture and in the "invisibles" accounts, particularly in
travel and franchising.  U.S. merchandise exports totalled $13 billion in
1993 and the OECD expects overall France merchandise imports to increase
6 percent by 1995.

B. Major  Business Opportunities
Demand should continue to be firm in 1995 for telecommunications
equipment; pollution control equipment; computer hardware, software and
related technology; plastics and resins; security/safety equipment;
laboratory and scientific instruments as well as in niche sectors of the
packaging, printing and chemical industries.  As the economic recovery
continues in France, we expect improved demand for building materials;
equipment related to air and surface transport and machine tools.


There is a growing market for consumer-ready food products, as well as
apparel and footwear for men and infants; do-it-yourself componentry;
hand tools; giftware and hardware.  French consumers show an interest in
the natural "American look", including, in particular, Western wear
clothing.

C. Synopsis of Commercial Environment
The French commercial environment is generally receptive to U. S. goods
and services; it is dynamic and reflects consumer trends as well as the
effect of comparative advantage in an interdependent world market-place.
Agricultural imports trend toward consumer-ready foodstuffs and away from
bulk commodities for animal feeds.  Most remarkable is the growth of
super-markets and hyper-markets, not only in food but also in apparel,
house-furnishings and, more recently, in building supplies, hardware and
tools.  The complex French society includes a strong market for high-
quality, high-tech consumer goods, particularly for its affluent cities
where the distribution system still uses independent specialty stores as
well as the more modern discount outlets.  Specifications, price and
quality figure high in industrial purchasing, to which is added the need
for just-in-time delivery in an increasingly competitive global market.

D. Host Country Business Attitude Towards the U.S.
In general the business attitude is favorable, as well, toward industrial
goods and services, travel/tourism and most consumer goods.  U. S.
agricultural products are perceived as being of high quality although at
times landed prices appear high.  There are, however, isolated cases
where business judgement as well as governmental action (or inaction) are
influenced by strong interest groups which do not hesitate to stage
noisy, visible, and sometimes violent demonstrations to favor French
suppliers.

The French market is mature, sophisticated and well-served by suppliers
from around the world.  It is unlikely, therefore, that major business
breakthroughs will occur, but, rather, that business opportunities will
be created in such niche markets as:  regional U. S. foodstuffs (Tex-
These, Cajun & California cuisine);  software tailored to the French
market; and direct merchandising via catalogs for apparel and house-
furnishings.

E. Obstacles to Doing Business
Most U.S. companies face no major obstacles in doing business in France
with a few significant exceptions, namely, restrictions on the TV
broadcast of non-European films and programs and the limitations on the
performance of legal services by non-French lawyers.  In the food
products area, an obstacle to new-to-market items is the French
consumer's unfamiliarity with the product, implying that the U. S. vendor
needs to invest in market development and "how-to-use" programs.

F. Nature of Local and Third Country Competition
Competition--both local and third-country--confronts American business at
every corner in the coveted French market.  It is particularly heavy in
both industrial and consumer areas where the product line has become
mature and can be considered a "commodity".  With the increasingly free
flow of goods and persons among the EU member nations, there is a natural
tendency to buy within the community; this factor needs to be kept in
mind by U. S. suppliers so as to be competitive in shipping expense and
in timely deliveries.

Despite the fierce competition, U. S. suppliers can still do good
business in France; innovative products, new design, outstanding quality,
service and a keen eye for inherent comparative advantage all add up to
promising sales.