Manufacturing Growth in France Could Propel it to Number 3 in The World

French Manufacturing

France is the fourth largest industrial manufacturer in the world. Twenty percent of their GDP comes from industrial manufacturing, and their success shows no sign of slowing. With an annual growth rate of 0.5%, manufacturing serves as a primary source of income and an essential piece of the economy. As the tenth largest economy in the world, Frances boasts a $2,699 trillion GDP and a 1.1% GDP real growth (2016).

One of the keys to French manufacturing success is the diversity of products they produce. With their strength in technological innovation and knowledge, they can produce goods in almost any industry:  food products, chemicals and pharmaceuticals, textiles, vehicles, metallurgy, and machinery. Today, we talk about French industries with the most significant contributions to their global standing.

Gourmet Food and Wine

The French have always been famous for their food, but maybe you didn’t know about their food and beverage manufacturing and exports. They produce and export gourmet and artisan cheeses (as the second largest producer after the US), wines (as the second biggest producer after Italy), meats, and bread.

This industry plays a major role in the economy by employing more than 500,000 French workers across more than 11,000 companies. The beverage sector alone contributes more than 11 billion euros in annual revenue. Such products are particularly beneficial because they add value to local agriculture while strengthening trade agreements. Nearly 30 percent of all food and beverage exports are sent outside of the EU, particularly to Asia and North America. Trade agreements continue to open a variety of other relationship possibilities.

Chemicals and Pharmaceuticals

France’s Chemicals and Pharmaceuticals industry occupies sixth place in the world. Their production of basic, specialty, and fine chemicals earn the country prestige only behind China, the US, Japan, Germany, and South Korea. Specifically, France is THE world leader in cosmetics and perfumes.

While they export these chemicals primarily within the EU, they also export to parts of Asia. Nearly 3,500 chemical and pharmaceutical companies employ over 156,000 people to produce around $110 billion Euros in revenue. These sales alone speak for the significance in the French economy.

 Automotive Investment

France produces an average of 4 million vehicles each year. This places them as the 5th largest automotive producer in the EU. However, their innovation is the industry is well-known and highly regarded.

To the same end, the sector is a magnet for foreign investment which makes it a priority industry for the French government. In recent years, they have redirected policies to aid the development of auto manufacturing while benefiting both local and foreign investors.

This year, France continued to maintain their PMI above 50, which firmly places manufacturing as a primary element of their economy. In addition, the data shows a steady rise in production volume, exports, and employment growth. While France currently sits in a strong global manufacturing position, all indicators point to their continuing ability to flourish with innovative technology, skilled workers, and diverse products. With all market trends pointing up, they may be headed to the top three soon.

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Croatia’s Manufacturing Economy Has Come a Long Way

Croatia Manufacturing Economy

Croatia has come a long way in the last few years to establish its manufacturing economy. As a former state of Yugoslavia, it only became an independent country in 1991. Although it was plagued by hardship and war during the first few years, it is now a stable, safe, and productive member of the European Union.

After the collapse of the Soviet bloc and its war of independence, Croatia went through a process of economic transition. Its incipient market-based economy was slowly improving as the years went by. Before the financial crisis of 2008, Croatia grew about 4% annually. It became a member of the World Trade Organization (WTO) in 2000, and it entered the European Union in 2013.

Most of the economy of Croatia is based on services. In fact, the tertiary sector makes up 70% of the Croatian gross domestic product (GDP), which was about $94.24 billion in 2016 by purchasing power. However, manufacturing has an increasing role in the Croatian economy. The industrial sector makes up about 26% of the Croatian GDP, and that sector grew 2.7% in 2015 and 3.5% in 2016.

This European country has developed important branches of manufacturing such as the wood industry, food manufacturing, shipbuilding, paper manufacturing, textiles, and automotive manufacturing, among others.  Croatian manufacturing exports reached about 10 billion euros in 2015, which made up about 94% of total exports that year.

Two Main Manufacturing Sectors

Food and Beverage: The food and beverage sector makes up about 20% of the total manufacturing industry revenues. Among these companies is Cedevita d.o.o, one of the biggest brands in Croatia and Slovenia, famous for its orange flavored drink offering nine essential vitamins. Originally owned by a pharmacy company, the drink was developed in the same plant as the popular Ovaltine. Now, the favored beverage offers several new flavors and is available in nearly every cafe and grocery store in Croatia. Other popular Croatian food and beverage companies include Jamaica (bottled water), Zvečevo (chocolate products and alcoholic drinks), and Carlsberg Croatia (beer).

Automotive Parts: Like the rest of Europe, automotive manufacturing plays a significant role in the economy. 11.2% of all manufacturing revenues in Croatia come from motor vehicle production. Croatia mostly produces automotive parts and software. Some of the most important enterprises of this subsector are Đuro Đaković Holding d.d. (Boilers, railway vehicles), Rimac Automobili (high-performance electric cars, drivetrain, and batteries), DOK-ING (unmanned and electric vehicles) and KONČAR Group (rail transportation)

It is not easy for Croatia to have a prominent economic role in its region because of the highly competitive and diversified industries of neighbors such as Italy and France. However, Croatia has made a lot of efforts to improve its manufacturing sector after the difficult and tumultuous moments of its history. Today, it is one of the most prosperous countries of the former Yugoslavia.

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Adoption of The Euro Pays Off for Slovakia Manufacturing

Slovakia Manufacturing

In 2009, Slovakia made one of its best economic decisions by adopting the Euro. Since then, Slovakia has experienced a steady economic growth from both the services and manufacturing sectors. Unemployment rates dropped and now hover around 8%. Today, 40 Slovak enterprises earn their rank in the 500 most important European companies.

The Slovak manufacturing industry produces more than 30% of the country’s GDP. Since Slovakia tends to pay lower wages than surrounding countries like Germany and the Czech Republic, the costs of production are also significantly lower for foreign investors. Companies like Volkswagen and KIA have become some of the biggest enterprises in Slovakia, having opened plants here to cut costs.

Automotive Manufacturing

As one of the largest automotive companies worldwide, Volkswagen has a major headquarters in Bratislava. This plant produces about 1 million units per year, and just last year, the company spent 150 million euros to build an on-site logistics center. Now, Slovakia is a power force for European car production.

Germany is the number importer to Slovakia; Volkswagen ships in about 90% of assembly parts by train daily. In 2016, exports from Germany to Slovakia valued close to 16 billion euros. Volkswagen Slovakia has now sold more the 6 billion Euros worth of vehicles.

KIA Motors Slovakia is another prestigious automobile company. The plant in Zilina manufactures engines and assembles finished vehicles. They’ve produced more than 300,000 units annually since 2014, and by 2016 exceeded 1.5 million Euros in sales. The plant currently provides employment for about 5000 people, but that number is expected to rise with predicted for expansions.

Equipment, machinery, and activities related to automotive account for more than 40% of the nation’s total manufacturing.

Technology Manufacturing

Most Eastern and Central European countries focus in the automotive, metallurgy, and engineering industries which makes technology a rare exception.

As has been mentioned, foreign investment is of vital importance to the Slovak economy.  Samsung is one of the few technology companies in Slovakia. While Samsung is most famous for their cell phones, they are also a power player in other electronics. In fact, Samsung is the largest producer of LCD screens in the world. Their main plant in Voderady manufactures these LCD screens. Since they do not produce finished electronic products, Slovakia is still a major importer for electronics. Currently, the subsidiary of the South Korean company in Slovakia invoices more than 3 billion euros and employs hundreds of people.

The combined efforts of KIA and Samsung have placed South Korea as the sixth largest trading partner to Slovakia. Korean imports have reached around 5 billion Euros.

Manufacturing Metals

U.S. Steel Košice, a subsidiary of the American U.S. Steel company, is currently the largest Slovak manufacturer in the metallurgical sector. Last year, U. S. Steel Košice nearly broke 3 billion dollars in sales. While it is an important company to the Slovak economy, it does not touch the metal manufacturing of the rest of Europe. With all subsidiaries, U.S. Steel is the 15th largest steel producer in the world.

Changing to the Euro opened many opportunities resulting in the creation of jobs, foreign investments, and an increase in exports. Since then, Slovakia economy has steadily risen.

 This article brought to you by The Cleveland Deburring Machine Company. CDMC can provide a deburring solution for gears, sprockets, aerospace and defense, automotive deburring, power transmission, powdered metals, fluid power and custom deburring applications. Our no-charge application evaluation includes a detailed report and process description in as little as 3 to 5 business days. Contact CDMC today for a deburring machine that’s right for you.

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