France 2030: What Have We Learned Two Years Later?

This article delves into the core of the France 2030 initiative, analyzing its implementation and effectiveness at the halfway point, and outlines what the future might hold for the French economy thanks to this ambitious plan.

54 billion euros. That is the amount the government has committed in 2021 to radically and profoundly transform the French economy. A major public investment plan to support innovative companies capable of becoming European and global leaders. A major plan to reindustrialize the country in a sustainable manner and restore its sovereignty, in an increasingly uncertain geopolitical context, while accelerating the ecological transition. Included in the France Relance plan, France 2030 is combined with the 4th Future Investment Program (PIA 4) for a total of 100 billion euros to be deployed over five years. By way of comparison, Horizon Europe (the European counterpart to France 2030) represents an investment of 95.5 billion euros over a similar timeframe (2021–2027).

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Results after 2 years of investment

Over the past two years, numerous calls for proposals have been issued, and many companies have received funding. The interim evaluation report on France 2030, published in the summer of 2023, takes stock of what has been achieved by the public investment program. So, two years after the launch of France 2030, where do we stand?

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_{“Now another challenge—especially as I speak to you today—is to build on this progress while also accelerating it. And this is essential because the world is moving faster too, and competition is even tougher. [...] We must move faster and stronger.” Emmanuel Macron, December 11, 2023, in Toulouse, on the occasion of the two-year anniversary of the France 2030 plan.}

Beneficiaries of the plan

SMEs and research organizations lead the way

As of April 30, 2023, nearly 14 billion euros had been committed to making the French economy more competitive, more innovative, and greener. To achieve these goals, the France 2030 plan has chosen to take action across the entire ecosystem. That is why all stakeholders have been supported through loans or grants. SMEs are the most frequently funded stakeholders: the 1,136 beneficiary SMEs account for 51% of the stakeholders that have received public funding.

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However, in terms of the share of funds received, these SMEs account for only 22% of the total. The entities that received the largest share of public funding disbursed by France 2030 are research organizations. They account for only 16% of all entities, but received more than 34% of the total amount committed. As for large companies, they received more than 18% of the total funds disbursed, even though they account for 22% of the beneficiary organizations.

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These results make perfect sense. SMEs account for the vast majority of French businesses and are involved in technology development projects, albeit with limited budgets. On the other hand, research organizations require substantial budgets to fund the basic research needed to advance our understanding of breakthrough technologies. Finally, large companies have the greatest financing capacity and are able to fund larger-scale projects.

Disparities by program and sector

However, it seems necessary to qualify this breakdown of France 2030 funding. In fact, the recipient organizations vary considerably depending on the sector and the type of program. First, depending on the funding mechanism: calls for projects (which account for the majority of funding) support as many emerging organizations (those less than 12 years old) as non-emerging ones. In contrast, bilateral funding and PIIECs (major projects of common European interest) fund non-emerging actors to a much greater extent (72% and 68%, respectively).

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The same diversity is also evident in the various calls for proposals: Among the structural programs (I-Lab, I-Nov, I-Démo, 1st Usine), all except 1st Usine primarily fund emerging players. In contrast, of all the targeted programs (maturation, demonstrator, deployment, and industrialization), only the maturation calls for proposals primarily fund emerging players.

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Finally, when broken down by sector, the same disparities are evident. 99% of the recipients of funding in the space sector are emerging players. More than 60% of funding for cultural content, future training programs, and sustainable food systems also went to emerging players. In contrast, less than 20% of the funds allocated to low-carbon aircraft and small modular reactors (SMRs) went to these sectors. For industrial decarbonization, the figure is only 4%.

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These differences can be explained quite simply by the level of technological maturity in the sectors or the characteristics of the targeted companies. For example, the most polluting industrial sites are clearly the ones most affected by decarbonization, and the vast majority of them are older facilities, which explains the high proportion of non-emerging companies.

Geographical distribution of funds

Focus on three key areas

As the report points out, the France 2030 plan was not intended to reduce regional inequalities, but rather, more broadly, to create the conditions for a better economic future. In this sense, we should not expect it to be distributed equally among France’s regions. This is why the Île-de-France region alone has received over 4 billion euros for its 650 supported projects, out of the 9 billion already invested by France 2030. The Auvergne-Rhône-Alpes and Occitanie regions (the next two regions) lag far behind, with 301 and 161 subsidized projects, respectively.

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Nevertheless, certain aspects of France 2030 have a strong regional focus. The “regionalized France 2030” initiatives are implemented directly by the regions, which fund the projects they deem most suitable for their areas. Furthermore, one of the stated objectives of France 2030 is the reindustrialization of the country. Unlike other sectors, these industries are predominantly located outside the Île-de-France region (which accounts for “only” 12% of all industrial activity, compared to 16% for the Auvergne-Rhône-Alpes region), according to INSEE2.

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Funds allocated to the development of factories and strategic industrial projects thus provide significant support to the entire country. As a result, 77% of the funds allocated to the decarbonization of industry were directed toward companies located outside the Île-de-France region, as were 68% of the funds allocated to biopharmaceuticals.

Sector-specific commitments

Disparities in engagement

The report highlights significant disparities in funding commitments across the sectors covered by France 2030. Half of the funds allocated to support higher education and research have been committed, compared with only 10% of the funds allocated to support projects related to electronics and robotics.

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In certain sectors, such as industrial decarbonization, only 2% of the funds have been committed. This low rate is due to the time required to approve the grants (which are often large in scale and therefore require the approval of the European Commission).

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The sectors in which France 2030 funds have been most heavily invested:

• France 2030: Regionalized (80%)
• Higher Education and Research (49%)
• Support for startup growth (39%)

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The sectors in which France 2030 funds have been least committed:

• Electronics and Robotics (10%)
• Biopharmaceuticals and medical devices (20%)
• Hydrogen and renewable energy (22%)

Environmental impact

Review and Outlook

As of April 30, 2023, more than half of the supported projects had no direct decarbonization impact (54%). Only 21% of the projects have a direct and lasting impact on the decarbonization of industry or practices.

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Nevertheless, France 2030 will have a concrete and direct impact on the decarbonization of the French economy and practices, with the aim of better achieving the ecological transition. As mentioned earlier, the funds earmarked for the decarbonization of industry have yet to be committed. And the majority of support for projects developing hydrogen and renewable energy, as well as nuclear power, within France has not yet been committed either.

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It is therefore only a matter of time (and the allocation of resources) before France 2030 achieves its full environmental impact.

Conclusion

Key takeaways

• SMEs accounted for the largest share of recipients (51% of the total), but research organizations received the largest amounts (34% of the funds committed).
• Companies in the Île-de-France region are by far the biggest beneficiaries of France 2030 grants, in line with their economic weight in France’s GDP (€4 billion out of the €9 billion disbursed at the time of the report).
• Funding has been allocated unevenly across the sectors of France 2030. Very little funding has been allocated to electronics, biopharmaceuticals, and renewable energy.