– Announcement of investment plan for strategic nurturing of next-generation industry that will represent France –
– Focus on small reactors, green hydrogen, electric vehicles, low-carbon airplanes, and revitalization of domestic manufacturing –
President Macron of France announced 'France 12', an investment plan to foster France's future industries, at the Elysee Palace on October 2030. It is about making an investment of 2022 billion euros for five years from 5 to nurture a representative industry that will succeed the technological powers that have represented France in the past, such as nuclear power, TGV, and Rafale fighter jets.
President Macron Announces 'France 2030'
Announcement of 5-year plan for strategic nurturing of future industries
'France 2030' contains a vision to strategically nurture future industries by leading an eco-friendly transition throughout the industry and actively supporting France's excellent technologies (energy, automobile, aerospace, and space). Specific investment plans are as follows.
A closer look at the energy sector, where the largest amount of 80 billion euros will be invested, contains the following.
In the case of the first target, the development of innovative small nuclear reactors, an investment of 2030 billion euros is planned by 10. In addition, in order to become a leader in green hydrogen energy, it plans to build at least two electrolyzer factories by 2030, and aims to not only mass-produce hydrogen energy but also develop hydrogen energy utilization technology. In the case of industrial decarbonization, the detailed goal is to manage carbon dioxide emissions in the steel, cement, and chemical sectors, which are representative greenhouse gas emitting industries, in order to reduce greenhouse gas emissions by 2% compared to 2030 by 2015.
Regarding future food development, he said that he plans to invest in the digitalization of the agricultural and livestock industry, introduction of robots, and genetic research. In addition, we are planning to build a large-scale studio that can produce content by referring to platforms such as Netflix in order to take another leap forward as a creative cultural content production powerhouse. It was announced that it would be developed as a strategic center for content creation of 'French Touch'.
Lastly, in the space and aerospace fields, it plans to develop reusable small rockets and microsatellites, find rare minerals in the deep sea, and invest in innovation in the field of biomimicry.
President Macron outlined five conditions that require continued attention and support for the realization of the above plan. These include stabilizing the supply of raw materials such as rare earth and electronic components such as semiconductors, improving recycling capacity, strengthening digital safety environment, predicting competitive human resource demand, and strengthening investment for deep-tech and manufacturing-type startups. Among them, it promised an investment of about 60 billion euros for the smooth supply and direct production of electronic components, and 25 billion euros for accelerating talent cultivation through new specialized training courses in connection with universities and research institutes. In addition, it announced an investment plan of 50 billion euros to foster startups. Furthermore, President Macron added that while meeting these conditions, he would establish a committee with university officials, researchers, investors, and officials from large private companies to systematically lead 'France 2030'.
Fields that are attracting attention as 'France 2030'
This future investment plan is characterized by supporting both areas where France can lead and areas where it is relatively lagging behind. In his speech, President Macron stated that while strategically fostering areas where France can be a leader, it is necessary to acknowledge France’s vulnerabilities revealed by the COVID-19 pandemic and use this as an opportunity to spur technological development for the development of innovative future industries.
First of all, energy, which France selected as a field with high potential to lead the global market, and nuclear technology among them, is attracting attention because it is a field that has not received much attention in the existing national investment strategy. Among the nuclear power generation technologies mentioned this time, the Small Modular Reactor, according to a report by the Korea Energy Economics Institute, is characterized by its simplicity, low construction cost, and high stability. nuclear power technology.
In France, EDF, a state-owned electricity company, is in the process of 'Nuward', a small module nuclear power plant development project. President Macron emphasized the need to develop safer and less wasteful nuclear power generation technology to produce electricity that can sufficiently produce hydrogen energy. Regarding the French government's vision, Bryan, Garnier & Co analyst Regnard said in an interview with the daily Les Echos, "The future of nuclear power and the justification for continuing to develop 3rd generation EPR-type large reactors. It can be interpreted as part of “to secure” and can be viewed as a paving stone for generating electricity that can sufficiently support future mobility.
On the other hand, in this announcement, President Macron sharply criticized the current state of the French automobile industry and emphasized that it is time for innovative development. Macron pointed out that over the past 30 years, the French automobile industry has continued to regress due to the lack of cooperation among the companies involved. In fact, the French government has ordered Renault to join ACC, a battery development company created through a joint venture between Stellantis and Total, to develop electric vehicle battery technology. A partnership has been signed, and Renault Motors is also looking for another partner to develop the battery. The daily newspaper Les Echos analyzed that the president's remarks were intended to critique the interests of companies that hinder the development of France's unique technology and to put pressure on them. Disruptive innovation that can occupy a market while completely reorganizing the industry is also important, but without a strategy of genuine cooperation, France's unique technology will fail. It is also necessary to understand in the same context as he repeatedly emphasized that there is. Along with these criticisms in this announcement, as they promised to invest intensively in the production of electric vehicle batteries and engines, the development of hydrogen energy technology for large mobility means, and the expansion of electric charging stations, attention is being paid to how the French automobile industry will move.
It is also noteworthy that the health sector was mentioned as a sector that needs to regain its past glory. In this speech, President Macron emphasized that France, which enjoyed the top position in Europe in the health sector including biotechnology and pharmaceuticals 20 years ago, has fallen to 4th place today, and that we must face the painful reality and make efforts to regain our position as leaders. To this end, 'France 2030' aims to develop more than 20 types of biomedical drugs that can treat cancer, chronic diseases, etc., and also promises to focus on supporting the production of future medical equipment to foster France's 'MedTech' industry. As the post-COVID-19 economic stimulus package 'France Relance' already supports the development of AI technology that can be used in medical imaging technology, IoT technology for connected pacemakers, and quantum technology necessary for the development of biosignal collection sensors, attention is focused on what kind of synergy effects a series of investment strategies planned for the development of future medical technologies can produce.
In addition, local media in France are showing great interest in the production of electronic components, especially semiconductors, which France has been lagging behind. This is because, although it has relied on semiconductors produced in Asian countries and the United States, the need for semiconductor production in France and Europe has increased as the supply and demand of semiconductors has been unstable. According to Le Monde, a daily newspaper, Digital Secretary of State Cédric O said that Europe must rise again in the semiconductor sector, adding that close cooperation from field companies is needed. It can be understood in the same context that semiconductors were specifically mentioned among various technologies in this presentation.
Expert opinion and implications
As it is a very recently announced investment plan, it seems difficult to predict the future of 'France 2030' as yet, no additional details have been revealed other than those mentioned in the President's speech. For this reason, the reaction in French society to this is also mixed. In the case of companies, they seem to think positively while maintaining a somewhat reserved view. According to the daily Le Figaro, the French industrial federation Medef emphasized that the initiative should be “focused on private enterprises, and the governance (direction and operation) should also be transparent”, not only developing new technologies but also “guaranteeing true development” To do this, we need to support the use of new technologies.” On the other hand, in an interview with the daily newspaper Les Echos, the CEO of Redex, an electronic component manufacturer, also expressed his belief that the state should be wary of deciding which areas to invest in as it could be seen as giving up the tradition of technology neutrality. In addition, it is pointed out that it is more important to create an environment for companies to invest more actively through tax benefits than such subsidies.
Despite these concerns, the French government’s will to invest 30-40 billion euros for ‘France 2030’ starting next year remains firm. Attention is being paid to how this investment plan will be differentiated from previous support plans, such as the ‘Future Investment Programme (PIA, currently in its 4th PIA)’ that began during former President Sarkozy’s term and the post-COVID-19 economic stimulus plan ‘France Relance’.
Source: French administration (gouvernement.fr), Elysee Palace website (elysee.fr), French public administration website (vie-publique.fr), daily newspapers Les Echos, Le Figaro, Le Monde, Kotra