Election nightmare for Emmanuel Macron as France slapped with £7.5 BILLION trade deficit
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Despite Mr Macron’s tough talk ahead of the election in April, Jacques Sapir believes the country has been “downgraded economically”. Mr Sapir, who has been director of studies at the École des Hautes Études en Sciences Sociales (EHESS) since 1996, claimed the country is quickly losing its industry. At the centre of this economic decline is the introduction of the euro, Mr Sapir claimed.
According to The National Institute of Statistics and Economic Studies (INSEE), France accrued a trade deficit of €9billion (£7.5billion) last November.
Commenting on this figure, he told RT France: “This very bad figure is neither an accident nor an exception.
“It reflects the rapid erosion of the country’s competitiveness since the implementation of the euro and its corollary, the accelerated de-industrialisation that we are experiencing, and which feeds the feeling shared by many French people that our country has been downgraded economically.
“This bad figure comes at a time when the economy is slowly recovering from the health crisis caused by COVID-19.
“One might think, or even hope, that it could therefore be only transitory.
“Unfortunately, this is not the case. France’s trade balance has been steadily deteriorating since 2005, as shown by INSEE statistics.”
In his piece, the economist also said the euro has killed the competitiveness of the French economy.
As per the IMF, who calculate the real exchange rate (REER) for each economy and measures the difference between this and the nominal exchange rate, France is overvalued.
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In the report, France has an economy eight percent above what it should.
In comparison, Germany is 9.2 percent undervalued.
He concluded: “Even if the political class now claims to be aware of the problem, and François Bayrou’s public admission is confirmation of this, even if there is now only talk of “relocating” activities and imagining re-industrialisation projects, nowhere do we see any questioning of what is causing the loss of competitiveness of the French economy: the euro.
“As long as the euro is not called into question, as long as France has not regained its monetary sovereignty, all these fine speeches will remain what they are: speeches, and more precisely, smoke and mirrors to attract the electorate in an election period.
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“Bruno Le Maire can thus forget about the bad results of last November and continue to praise Emmanuel Macron’s economic record.”
According to separate figures from the IMF, France’s account balance has decreased year-on-year since 2018.
In 2018, the figure stood at 0.6 percent but has fallen to -2.1 percent.
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In contrast, Spain and Italy’s own figures now stand at one and 3.5 percent, respectively.
Germany’s own figure is 7.6 percent but has never fallen below seven between 2018 to 2021.
Additional reporting by Maria Ortega.
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