Paris, February 6, 2009
FRENCH FOREIGN TRADE/COMPETITIVENESS
Q. – What caused the higher trade deficit in 2008?
THE MINISTER – The deterioration in 2008 is due more to external events than any competitiveness issues. The oil bill, which comes to nearly €60 billion – after €47 billion the previous year –, is particularly high. And since the second quarter, demand from our main customers has collapsed. The European Union’s importance in our foreign trade isn’t, in this respect, an asset.
Q. – You talk about competitiveness: is France still losing market shares?
THE MINISTER – Well, precisely, the initial information at our disposal tells us that France’s competitiveness has stopped deteriorating. France’s share in Euro Area exports has stabilized. This is the result of the reforms the government has set in train. (…)
Q. – How do we avoid exports collapsing in this year of acute economic crisis?
THE MINISTER – The IMF and World Bank are predicting a reduction in international trade: we won’t be able to prevent our exports also being affected. But, in addition to being affected by the overall economic situation, the development of trade will depend on the availability of liquidity. Exports are very dependent on credit conditions. Every country must ensure that banks continue to finance commercial operations, which means, particularly at G20 level, doing the utmost to encourage confidence and prevent the return to protectionism. We will also have to brief our exporters and give them guidance in a tough and pretty unpredictable environment. I have asked Ubifrance [French Agency for international business development], to use one of Christine Lagarde’s expressions, to adopt a "crisis busting" programme and inform our businesses of the opportunities presented by stimulus plans abroad.
Q. – Precisely, do you fear a return of protectionism?
THE MINISTER – We are very closely following what is said and done on this in every country. For the moment, we sense some signs of a temptation to go down the protectionist road, but there’s been nothing really concrete. I note with satisfaction that President Obama has spoken out against the provision supposedly designed to protect American steel in the stimulus plan under consideration in Congress. But today the risk doesn’t lie in the emergence of conventional protectionism in the form of higher customs tariffs. In a lot of countries, the stimulus plans are calling for public investment, which focuses in priority on local businesses.
Q. – What should be done to prevent this?
THE MINISTER – At the G20 summit, we’ll have to give the WTO a clear mandate to prevent all forms of unfair competition.
2009 POLICY PRIORITIES
Q. – What will your policy priorities be in 2009?
THE MINISTER – We’ll have to seek "growth niches", relying more than ever on our strong points, such as major capital equipment contracts. In terms of countries, we’ll go where growth is standing up better than elsewhere, such as Brazil, India and the Middle East, without neglecting sectoral niches, for example, which are valuable in the short term and form the basis of tomorrow’s investment. This is the case, for instance, for sustainable development in which our big companies are very active, but where large numbers of small French business also have genuine internationally recognized know-how. We’ll help them export.
Finally, we must be able to come out of this crisis less dependent on trading only with our European partners. That means going for overseas markets./.