French official trade deficit deepens to 6.46 bln euros

8th September 2011, Comments 0 comments

France reported an increased official trade deficit of 6.46 billion euros ($9.0 billion) in July on an adjusted basis owing to a rise of imports, in customs data released on Thursday.

The trade deficit is a central policy concern in France.

Exports towards other countries in the European Union fell but exports to elsewhere in Europe, the Americas and Africa did better.

In July, French exports totalled 34.76 billion euros. Imports totalled 41.22 billion euros.

The latest deficit means that the trade balance for the 12 months to the end of July shows a deficit of 67.21 billion euros from a deficit of 51.664 billion euros for the whole of last year.

In recent years France has run a structural trade deficit which is a big drag on growth and highlights a gap between performance by the French economy and in Germany.

France is increasingly focused on aligning its economy with that of Germany, amid the eurozone debt crisis.

Official German data on Thursday showed a trade surplus of 10.4 billion euros for July, down from 12.7 billion euros in June.

In France, imports of refined oil products, transportation equipment and computer equipment rose sharply in July but exports rose only slightly, the data showed.

In June the French balance showed a deficit of 5.40 billion euros and in May 6.59 billion euros. The data for April showed a record deficit of 6.91 billion euros.

Economists have long warned that France has run into a problem of competitiveness, and that it does not have enough strong medium-sized companies and that its small and medium firms tend to export mid-range products.

This is in contrast to Germany where the framework of medium-sized companies is strong and these firms have focused strongly on exporting high-quality products to niche markets, analysts say.

© 2011 AFP

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