Relations Between Asia and Europe.

Question: Describe about the Relations Between Asia and Europe? Answer: FDI incentives and restrictions in France: France welcomes foreign investment through a safe and stable business environment and the core competencies related to a modern and progressive business culture, policy incentives, trade promotion on an overseas basis and a range of investor support mechanism among other systems and mechanisms. Moreover, a transparent and regulatory legal environment further encourages growth and foreign investment (Andreosso-O'Callaghan, et al., 2007). The French Agency for International Investment is vested with promotion of foreign investment through coordination with Invest in French Agencies and Investment in French Network. However, notwithstanding this above mentioned factor, the aspects related to the taxation system, high labor costs, rigidity of labor markets, negative attitude and perception to foreign investor restructuring et cetera act as impediments or restrictions to foreign investment in France. Moreover, aspects related to the concept of the Golden share and government intervention also hampers foreign investment (Hill, 2000). FDI and Labor Laws in France: The labor laws in France vis--vis foreign direct investment can be related to the employment protection laws the French government has in place that relate to the terms of employment and treatment of the labors in the workplace and matters specifically related to the firing of labors or the terms and conditions and overall conduct of multinational firms in the way they employ and treat temporary laborers. The concept of the race to the bottom brought about through the activities of the governments to attract foreign investment by lowering their taxation and labor standards is put great emphasis under the French labor law system and there are strict provision related to the conditions of work, the emoluments and post-retirement benefits, insurance security, health and safety, terms of service and clauses for termination and wages and holiday are the particular areas where the labor laws of France seem to act as disincentives for foreign direct investment. However, under normal circums tances and obliging the basic legal requirements, the labor laws, while ensuring employment protection and proper wages do encourage foreign companies to hire more indigenous laborers, train and groom them and help create more and better job opportunities (Kabundi and Nadal-De Simone, 2007). FDI and Monetary Issues in France: Changes in the economic status and the resultant monetary issues can prove to be vital factors influencing the fate of foreign investment in a nation and sudden changes in the monetary policies in the wake of such situations are bound to have ripple effects on attraction of foreign direct investment. The monetary issues related to the saturation of the French economy, the growth stagnation and the fears of inflation act as impediments that hamper the prospect of foreign investment in France. Moreover, owed to the monetary issues, tighter policies and regulations and hostile taxation, employment and labor policies and systems and also the aspects related to the changes in the business regulation, business taxes, rising budget deficits, recession, taxation and changes in trade cycle are all important aspects that system act as further disincentives to foreign direct investment in France (Rugraff, Sumner and Sanchez-Ancochea, 2008). References Andreosso-O'Callaghan, B., Bassino, J., Dzever, S. and Jaussaud, J. (2007).The Economic Relations Between Asia and Europe. Burlington: Elsevier Science. Hill, C. (n.d.).International business. Kabundi, A. and Nadal-De Simone, F. (2007).France in the global economy. [Washington, D.C.]: International Monetary Fund, European Dept. Nadal-De Simone, F. and Kabundi, A. (2007).France in the Global Economy. Washington: International Monetary Fund. Rugraff, E., Sumner, A. and Sanchez-Ancochea, D. (2008).Transnational corporations and development policy. Basingstoke: Palgrave Macmillan.