Feb. 12 (Bloomberg) -- Presidents Barack Obama and Francois Hollande pledged to elevate cooperation between their countries as the French leader sought to leverage the relationship to boost investment by U.S. companies.
Hollande was guest of honor for a state dinner last night at the White House that was studded with diplomats, elected officials, celebrities, such as actors Bradley Cooper and Julia Louis-Dreyfus, and corporate executives, including Merck & Co. Chief Executive Officer Ken Frazier, Viacom Inc. CEO Philippe Dauman and Elon Musk, co-founder of electric-car maker Tesla Motors Inc.
The dinner followed Hollande’s closed-door meeting with company executives at the U.S. Chamber of Commerce. He flies to California today for a private lunch with leaders of technology and Internet companies. Among those scheduled to be there, according to French officials, are Facebook Inc. Chief Operating Officer Sheryl Sandberg and Google Inc. Chairman Eric Schmidt and Musk.
“This economic recovery in the United States is an opportunity for Europe, but it also is an example to be followed” in encouraging competitiveness and innovation, Hollande said at a news conference with Obama yesterday. “That is precisely the meaning of my visit to the Silicon Valley.”
Over two days of events and meetings, Obama and Hollande emphasized the long relationship between the two countries, from the American revolution and through two world wars, on the first formal state visit by a French leader since 1996.
The themes fit within Obama’s economic and foreign policy goals as he attempts to double U.S. exports before leaving office and marshals support on dealings with Iran and Syria.
Obama at the news conference ticked through areas of mutual interest, including sending a message that sanctions against Iran remain firm while negotiations over the Persian Gulf nation’s nuclear program continue. He said there was a joint commitment to find a political solution for the crisis in Syria and that economic cooperation with France was a priority.
At last night’s state dinner, where guests dined on American Osetra caviar, a winter garden salad, dry-aged rib eye beef from Colorado and Hawaiian chocolate malted ganache, the two leaders toasted the close working relationship.
“We’ve stood together for our freedom for more than 200 years,” Obama said. “And tonight I again want to pay a tribute to President Hollande for the principled of leadership and personal friendship and courage that he has shown on the world stage.”
“We love Americans, although we don’t always say so,” Hollande said. “And you love the French but you’re sometimes too shy to say so,” he said, to an uproar of laughter.
At home, Hollande, 59, is trying to woo business leaders with a promise to cut payroll taxes by 30 billion euros ($40 billion) and trim another 50 billion euros from government spending by 2017.
The French economy, the world’s fifth largest, has barely grown over the past two years and unemployment is at a 16-year high. The country’s gross domestic product probably grew 0.2 percent in 2013 and will expand 0.9 percent this year, before increasing 1.7 percent in 2015, the European Commission forecasts.
Hollande said he wants to promote innovation as a way to spark the French economy.
“There comes a point where, after an ordeal, you have to be stronger than you were before the ordeal, before the crisis,” he said. “You need to be able to mobilize more strength, more energy.”
Obama, 52, also is seeking faster growth. The U.S. economy expanded 1.9 percent last year and the unemployment rate fell to a five-year low of 6.7 percent in December. One of the ways he is pursuing growth is through trade.
He has set a goal of expanding exports to $3.14 trillion in value by 2014 from $1.57 trillion in 2009 and is negotiating two major trade agreements, one with 11 other Pacific Rim nations and another with the 28-member European Union. If completed, the deals -- which would be the largest trade pacts in U.S. history -- would link regions with about $45 trillion in annual economic output, about 62 percent of the world total.
As the global economy has improved since the end of the recession, U.S. exports to France have risen from $26.5 billion in 2009 to $31.9 billion last year, according to U.S. Census Bureau figures. Imports from France also have grown, from $34.2 billion to $45.3 billion over the same period.
Obama said he wants to expand such trans-Atlantic investment, both for U.S. companies in France and “any French companies who want to come here to do business.”
French direct investment in the U.S. totaled $222 billion at the end of 2012, and U.S. affiliates of French firms employ 525,000 people in the U.S., according to figures released by the White House. U.S. direct investment in France was $83 billion and affiliates of U.S. firms support 440,000 jobs there.
The U.S. and France are establishing a joint forum to expand trade and investment. Obama said the commercial relationship with France and the potential benefits from the Trans-Atlantic Trade Partnership would be a boon for businesses small to large in both countries.
“If we expand trade opportunities for them, that can mean jobs and growth in France, it can mean jobs and growth here in the United States,” Obama said.
Among companies that break down revenue from France in their filings, AptarGroup Inc., a maker of valves and pumps for fragrance and cosmetics dispensers, shows one of the highest proportions, according to data compiled by Bloomberg. About 27 percent of its revenue, or $650 million, came from the country in fiscal 2012, the latest figures it has filed show.
Other companies that report earnings from France include auto parts makers ITT Corp., Visteon Corp. and BorgWarner Inc.
Relations between the U.S. and France cooled following President Jacques Chirac’s opposition to the 2003 U.S. invasion of Iraq under President George W. Bush. Hollande’s immediate predecessor, Nicolas Sarkozy, sought to repair the alliance and was honored at a White House dinner by Bush in November 2007. That closer cooperation continued when Obama took office and has been solidified by Hollande.
Asked by a French reporter whether France was replacing the U.K. as the closest U.S. ally, Obama remarked, “Oh goodness.” He then talked about having two two beautiful daughters and “I would never choose between them.”
Hollande said having four children makes it even harder for him to choose favorites. “We’re not trying to be anyone’s favorite,” Hollande said of France’s relationship with the U.S. “It’s just about being useful to the world.”
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