French trade deficit widens

7th January 2011, Comments 0 comments

The French trade deficit in November widened to EUR3.87 billion from EUR3.71 billion in October, official data showed on Friday.

This took the cumulative deficit over the 12 months to November to EUR50.59 billion, the budget ministry said in a statement.

The trade deficit is still below the record EUR55.14 billion euros set in 2008 but higher than the EUR45 billion officials forecast at the beginning of 2010.

In November, exports totalled EUR35.00 billion and imports EUR38.87 billion, after EUR32.22 billion and EUR35.93 billion in October.

Economists have become increasingly concerned that France has a structural trade and payments deficit, a sign of the uncompetitiveness of French companies on the world market.

For Alexander Law of the Xerfi market research firms, the figures and other recent data "show that France cannot count on foreign trade for sustainable invigoration of its economy."

He was sceptical of any considerable improvement in 2011 as economic growth is likely to be slow in the major markets for French goods in Europe.

French Foreign Trade Minister Pierre Lellouche sounded the alarm bell on Thursday, warning that the gap between France's trade deficit and Germany's trade surplus is widening to nearly EUR200 billion, or 10 percentage points of France's GDP.

"Our market share in world trade has suffered the biggest decline among the OECD countries, a drop ... from 6.4 percent in 1990 to 3.6 percent in the first half of 2010," he noted.

© 2011 AFP

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