These days, not only is France one of the leaders among European countries, but it is also one of the most modern nations around the world. France, being a permanent member of the United Nations Security Council, the G-7, the G-20, the EU, NATO, and other multilateral organizations, plays an influential global role (“Europe: France,” 2020). Having experienced some economic instabilities earlier, France constructed a hybrid presidential-parliamentary governing system in 1958, making the government more purely parliamentary. In recent decades, the cooperation of France with Germany has been central to the economic integration of Europe. Moreover, the euro as a common currency was introduced in January 1999.
There was a trade deficit in the 1970s-1990s, which was a result of the high level of imports. Nevertheless, France experienced a trade surplus starting in 1992 due to a positive balance from non-merchandise transactions (e.g., tourism) (Higonnet et al., 2020).
France is currently a leading trading country. It is simultaneously one of the world’s most exporting and importing countries (“France,” 2017).
The value of French exports represents more than one-fifth of GDP.
France imports mostly such products as machinery, chemicals, traditional industrial goods, such as textiles, and tropical agricultural products.
France exports mostly such goods as raw agricultural products (e.g., grains), agro-industrial products (foods and beverages including wine), dairy products, and tinned fruits and vegetables (“France,” 2017). France also needs to export large quantities of oil and fewer amounts of gas and coal.
The exchange of goods is the basis for most foreign trade (Rehfeldt, 2018).
In 2017, France’s major import sources were Germany (18.5%), Belgium (10.2%), Netherlands (8.3%), Italy (7.9%), Spain (7.1%), UK (5.3%), US (5.2%), and China (5.1%) (“Europe: France,” 2020).
In 2017, France’s major export sources were Germany (14.8%), Spain (7.7%), Italy (7.5%), US (7.2%), Belgium (7%), UK (6.7%) (“Europe: France,” 2020).
Current Key Issue
As was mentioned before, France’s level of import was high, resulting in a trade deficit in the 1970s-1990s followed by a surplus due to an increased level of tourism starting in 1992.
Currently, the budget deficit in France improved to 2.7% of GDP. However, France’s public debt increased from 89.5% of GDP in 2012 to 97% in 2017 (“Europe: France,” 2020). Public debt, or national debt, is the difference between a government’s yearly spending and profit. In other words, it is a summary of annual budget deficits, which took place when the government was receiving less than expenditures. Public debt in France has been rising since 2007. France’s federal deficit has hit a record level in 2009 and 2010, with more than 137 billion euros (Rehfeldt, 2018). The data attained an all-time high of 100.8 % in Jun 2017 and a record low of 56.1 % in Dec 1995.
Besides, in 2017, France had a negative trade balance of $78.6B in net imports (“France,” 2017).
Conclusion
The economy in France is diversified over all sectors. France is one of the most visited countries in the world with 89 million foreign tourists in 2017 (“Europe: France,” 2020), which makes the country’s balance positive. However, currently, France experiences troubles connected with its public debt, as it hit an all-time high of 100.8 % in Jun 2017.
References
Europe: France. (2020). Web.
France. (2017). Web.
Higonnet, P., Bachrach, B. S., Woloch, E. W., Fournier, G., Shennan J.H., Wolloch, I., … Wright, G. (2020). France. Encyclopædia Britannica. Web.
Rehfeldt, U. (2018). Industrial relations in France: From the underdevelopment of collective bargaining to the failure of neocorporatist concertation. Employee Relations, 40(4), 617-633.