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The Foreign Trade The Great Unknown of 2021 - PDF
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Added on 2021-06-14
The Foreign Trade The Great Unknown of 2021 - PDF
Added on 2021-06-14
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Macroeconomics II THE THREE MOST IMPORTANT ISSUES FACING FRANCE’S ECONOMY IN 2021Jeanne BALBOT St Kliment University
CONTEXT.................................................................................................................................................... 2THE FOREING TRADE: THE GREAT UNKNOWN OF 2021.................................................................. 3A)FACT AND IMPORTANCE OF THIS PARAMETER............................................................................................ 3B)FIGURES.................................................................................................................................................... 3C)POTENTIAL’S SOLUTIONS.......................................................................................................................... 4UNEMPLOYMENT: 2021, A BLACK YEAR?........................................................................................... 4A)THE CONSEQUENCES OF POST-CRISIS UNEMPLOYMENT............................................................................. 4B)FIGURES.................................................................................................................................................... 5C)SOLUTIONS IMPLEMENTED........................................................................................................................ 6INEQUALITIES: INEQUALITY AND POVERTY, THE LIGHTS TURN RED....................................... 6A)THE RICHEST SPARED BY THE COVID CRISIS............................................................................................... 6B)FIGURES:PERCENTAGE OF RESPONDENTS WHO CONSIDER THEIR FINANCIAL SITUATION TO HAVE WORSENED DURING CONFINEMENT,BY STANDARD OF LIVING............................................................................ 7C)EMERGENCY MEASURES TO LEAVE NO ONE BEHIND.................................................................................. 8CONCLUSION: A RECOVERY TO BE PLANNED.................................................................................. 9REFERENCES........................................................................................................................................... 10
CONTEXT For more than a year, the waves of the pandemic have followed one another. Although no country has been spared, not all have suffered the same health, economic and social damage. Some countries are seeing the end of the tunnel, the least affected, such as many Asian countries, or those that have been able to vaccinate their population quickly. France is still confronted with a strong circulation of the virus but is not doing any better or worse than its neighbors. One year ago, France's first lockdown disrupted our lives and sent the economy into a free fall. A record drop in GDP (-19%) in the second quarter of 2020. Over the whole of 2020, production down -8.2%, hundreds of thousands of jobs lost, an explosion of debt, etc. As the virus continues to spread and all its inherent risks, the fate of growth depends on the success of the vaccination campaigns. As the experts at INSEE state in their forecast for 2021, next year's economic recovery will face several major unknowns. Among them, three are particularly closely watched by economic forecasters: The foreign trade, unemployment (business failures), and the evolution of inequality. After having triggered their stimulus plans to limit the losses of companies linked to the confinements, will the States be able to face their new responsibilities? Can France recover its pre-crisis economic level? And above all, is this desirable?
THE FOREING TRADE: The great unknown of 2021 a)Fact and importance of this parameter France is a major player in global trade. It is the world's sixth largest exporter and importer of goods and has no fewer than 128,323 French exporting companies. Its main customers are Germany, Italy, the United States and Spain and its main suppliers are Germany: 71.7 billion, China: 56.6 billion, Italy: 39.2 billion and Spain: 35.4 billion. Trade represents more than 65% of the country's GDP. France exports mainly aircraft, vehicles, pharmaceuticals, food products (wine), hydrocarbons and electronic components. The country imports many consumer goods, vehicles, hydrocarbons and pharmaceutical products. In 2020, due to the COVID-19 pandemic, trade volume collapsed. According to IMF data, the volume of exports of goods and services decreased by -16.8% compared to 2019, and the volume of imports decreased by -11.4%. Although trade has recovered, the path to this new economic normal is still difficult. The IMF forecasts a rebound in export volumes in 2021 (+9%) and 2022 (+5.4%), at a slightly faster pace than imports, which are expected to rise by 8.5% in 2021 and 4.7% in 2022. I think it is very important to talk about this parameter because the fluidity of trade has been considerably hampered, as has the strength of supply chains, and supply difficulties are multiplying. This is a parameter that should not be overlooked, as we are seeing a sharpslowdown in French production of export goods (containment measures, shortages of industrial inputs). French demand for foreign goods (energy, consumer goods, industrial goods) is declining, as is foreign supply (closure of factories abroad, disruption of value chains). b)Figures
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