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SECRET
CHAPTER II
ECONOMIC SITUATION
1. Introduction.
While diversity of activity has long been
characteristic of the economy, French indus-
General Characteristics and Conditions.
tries developed more slowly than those of the
France succeeded Germany after World
UK and of most continental neighbors.
War II as the leading economy in continental
France became to some extent dependent
Europe and its 1948 national income of about
upon imported agricultural produce even be-
$18.3 billion gave it third rank among west-
fore World War I, and in the 1930's about 15
ern countries (being preceded by the US and
percent of total food consumed was imported,
UK). The standard of living, though low by
while industrial production increased in im-
American standards, is presently surpassed in
portance.
Europe only by the UK, the Netherlands, Bel-
The table below indicates the relative
gium, Switzerland, and the Scandinavian
importance of three general categories of eco-
countries. Per capita income (a rough index
nomic activity in 1938 and in 1948, based
of living standards) in 1948 was approxi-
upon the number of workers employed.
mately $480 as against $1,562 in the US. The
As a world supplier of strategic commodi-
economy is still suffering from war losses and
ties, France is important only in respect to
dislocations, however, and is still dependent
iron ore and potash. Aluminum exports may
upon considerable foreign assistance. Pres-
become important. Total imports represent
ent plans to make the economy self-sustaining
only a small percentage of the value of total
by 1953 can be expected to succeed only by
production (11 percent in 1948) nevertheless,
dint of great efforts and on the assumption of
imports (particularly from the US) have been
favorable world economic conditions.
vital factors in the recovery which has taken
place. Since the war the chief imports have
1 Throughout this section the reference is to Met-
ropolitan France except as otherwise specifically
been foodstuffs, petroleum, coking-coal, fibers,
stated.
non-ferrous metals, and machinery. Depend-
25,500 billion francs converted at a rate of 300
ence upon these imports will continue, al-
frs=$1.00, which is considered a reasonable valua-
though changes in their relative importance,
tion of the franc for 1948, inasmuch as it was prob-
such as a reduction in food and an increase in
ably overvalued at the prevailing effective rates
(261-266) for most import and export transactions.
industrial raw materials, are contemplated. A
Population-41.6 million in 1948.
large part of these imports has been financed
1938
1948
WORKERS
WORKERS
Percent
Percent
Millions
of total
Millions
of total
Agriculture
7.1
38.1
7.4*
37.7
Manufacturing
6.8
36.5
7.0
35.7
Service (commercial, admin-
istrative, etc.)
4.7
25.4
5.2
26.6
Totals:
18.6
100
19.6
100
* Including part-time workers and urban workers in agricultural areas.
SECRETARY
23
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"ocrText": "SECRET\nCHAPTER II\nECONOMIC SITUATION\n1. Introduction.\nWhile diversity of activity has long been\ncharacteristic of the economy, French indus-\nGeneral Characteristics and Conditions.\ntries developed more slowly than those of the\nFrance succeeded Germany after World\nUK and of most continental neighbors.\nWar II as the leading economy in continental\nFrance became to some extent dependent\nEurope and its 1948 national income of about\nupon imported agricultural produce even be-\n$18.3 billion gave it third rank among west-\nfore World War I, and in the 1930's about 15\nern countries (being preceded by the US and\npercent of total food consumed was imported,\nUK). The standard of living, though low by\nwhile industrial production increased in im-\nAmerican standards, is presently surpassed in\nportance.\nEurope only by the UK, the Netherlands, Bel-\nThe table below indicates the relative\ngium, Switzerland, and the Scandinavian\nimportance of three general categories of eco-\ncountries. Per capita income (a rough index\nnomic activity in 1938 and in 1948, based\nof living standards) in 1948 was approxi-\nupon the number of workers employed.\nmately $480 as against $1,562 in the US. The\nAs a world supplier of strategic commodi-\neconomy is still suffering from war losses and\nties, France is important only in respect to\ndislocations, however, and is still dependent\niron ore and potash. Aluminum exports may\nupon considerable foreign assistance. Pres-\nbecome important. Total imports represent\nent plans to make the economy self-sustaining\nonly a small percentage of the value of total\nby 1953 can be expected to succeed only by\nproduction (11 percent in 1948) nevertheless,\ndint of great efforts and on the assumption of\nimports (particularly from the US) have been\nfavorable world economic conditions.\nvital factors in the recovery which has taken\nplace. Since the war the chief imports have\n1 Throughout this section the reference is to Met-\nropolitan France except as otherwise specifically\nbeen foodstuffs, petroleum, coking-coal, fibers,\nstated.\nnon-ferrous metals, and machinery. Depend-\n25,500 billion francs converted at a rate of 300\nence upon these imports will continue, al-\nfrs=$1.00, which is considered a reasonable valua-\nthough changes in their relative importance,\ntion of the franc for 1948, inasmuch as it was prob-\nsuch as a reduction in food and an increase in\nably overvalued at the prevailing effective rates\n(261-266) for most import and export transactions.\nindustrial raw materials, are contemplated. A\nPopulation-41.6 million in 1948.\nlarge part of these imports has been financed\n1938\n1948\nWORKERS\nWORKERS\nPercent\nPercent\nMillions\nof total\nMillions\nof total\nAgriculture\n7.1\n38.1\n7.4*\n37.7\nManufacturing\n6.8\n36.5\n7.0\n35.7\nService (commercial, admin-\nistrative, etc.)\n4.7\n25.4\n5.2\n26.6\nTotals:\n18.6\n100\n19.6\n100\n* Including part-time workers and urban workers in agricultural areas.\nSECRETARY\n23"
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