France widens trade gap in H1 owing to soaring energy bill

credit: financialtribune


France’s enlarged trade gap by 13.2 percent to 33.5 billion euros (38.84 billion U.S. dollars) over the January-June period this year from the second half of 2017 on rising costs of energy imports, official figures showed on Tuesday.

“This deterioration mainly reflects the increase in the energy bill, which accounts for nearly 60 percent of the deficit in our trade balance, notably due to the rise oil price, and car imports, while the aerospace surplus is strengthening,” said the French foreign ministry which is also in charge of foreign trade.

“In the economic recovery phase, it is usual that the improvement in the trade balance is not immediate because of the rise in imports which is induced by the rebound in domestic demand (household consumption and business investment),” it added in a statement.

At the end of June, an increase in energy purchases drove up trade deficit to 6.2 billion euros, the highest level since February 2017.

Over the period, French exports amounted 40.9 billion euros, up by 1 percent from May figures, while imports, totaling 47.2 billion euros, grew by 1.4 percent.

In order to overturn negative trade performance, “the improvement of our export performance is one of the objectives of the government’s policy,” the ministry said in the statement.

It aims to improve mechanisms to support exports and diversify partnership deals to offer wider opportunities for domestic products.

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