"If France wants to maintain its influence on an international scale it is imperative that it moves towards a major adaptation of its policy on education abroad," says the author of the report, Bernard Cariot.
"Faced with an environment which has seen major evolution this network is today at the cross-roads."
The first French school abroad opened in Berlin in 1689 and there are now 413 in 130 countries educating some 230,000 pupils. Alumni include Hollywood star Jodie Foster and former United Nations secretary general Boutros Boutros Ghali.
The international network of French schools is far larger than that of any other country and has been seen as playing an important role not only in educating the children of expatriate citizens but also in producing Francophile local elites.
The schools' relationship with the French state varies: some are directly run; others are subject to supervision; while a third group offer curricula that have the approval of the French state. For historical reasons there is a heavy presence of schools in Africa, particularly in former French colonies. Morocco alone boasts 30 schools in which 6 per cent of all expatriate French teachers work.
The report to France's Economic and Social Council, identifies areas where change is needed. It praises the exam results of the schools, 93 per cent of whose pupils pass the baccalaureat-15 percentage points more than in France - but points out that while non-French pupils are still in the majority the number is declining.
It says that the shifting economic interests of France have not been matched by the creation of local schools and speaks of the danger that this "extraordinary network could become fossilised".
The report accepts that there is little chance in present circumstances of more money being available: the system already costs 818 million euros (pound;570m) a year of which France contributes 31 per cent, the rest coming from fees.
It says that the French baccalaureat is not well recognised outside France and that relations between the international schools and universities back home are unsatisfactory. Fees are rising too fast and more teaching needs to be done in local languages.
Closer co-operation with other French cultural institutions, such as the Alliance Francaise teaching association and cultural centres, is seen as one option.
The report also says that the schools should avoid becoming centres of for local elites, as this often reduces the incentive for local governments to develop their own schools system.