Economic Factors Affecting Trade Patterns in the U.S. & France
- A thin line exists between factors affecting trade in France and the U.S.economy avenue, concept photo image by Albo from Fotolia.com
Shifts in both the global economy and in trading policies present challenges and opportunities for both the United States and France. According to Economy Watch, both countries have enjoyed good economic prospects from 2000 onward, with France appearing among the top 10 in 2006's World Bank ranking. Besides domestic political factors, the trading patterns in both two countries are greatly influenced by global economic factors. - With the strengthening of world supply chains, global trading patterns have changed due to an increase in Free Trade Agreements (FTAs), custom unions and Preferential Trade Arrangements (PTAs). The United States participates in 11 FTAs that bring together 17 nations. France, on the other hand, participates in FTAs under the umbrella of the European Union. Moreover, most of the global partners of the U.S. and France are known to participate in most of these FTAs. According to the Congressional Research Service, you can expect to see changes in trading patterns in both the U.S. and France as the global economy moves toward liberal global trading without tariffs and trade barriers.
- The world is fast becoming a global village due to both technological advances and improvement in the global transportation infrastructure. Globalization has led to the development of a global production network where transfer of materials, goods and manpower across nations is easier. Individuals in the U.S. and France can easily do business abroad with ease. However, according to the U.S. Chamber of Commerce, trade patterns and policies are likely to change in the U.S. and in other developed nations such as France as tariffs on imports and exports reduce due to an increase in easy shipments of unfinished products across nations.
- The aftermath of the global economic meltdown experienced in 2006 to 2008 influenced trade patterns and policies, not only in the U.S. and France, but also in the global economy. According to the Congressional Research Service, the United States experienced a decline of 17.9 percent in its exports and 25.9 percent in its imports between 2008 and 2009. According to Economic Watch, the exports and imports also slumped in France with declines of 24.1 percent in exports and 23.09 percent in imports during the same period.
- The year 2010 presents a mixed outlook for the U.S. and French economies, especially as developing nations such as Brazil and India continue to rise. According to the Congressional Research Service, the developing nations contributed 32.8 percent of total exports and 34.5 percent of total imports to the U.S. economy in 1985, but in 2009, the figures changed to 51.6 percent and 59.8 percent, respectively. Therefore, the emergence of developing economies and shifts in international trade will continue to present both challenges and opportunities to both France and the United States as two of the world's strongest economies. The emergence of these developing countries in the international trade market has not only caused the United States and France to review their trade policies in regard to new partners such as China, but has also brought stiff competition for goods from both France and the United States.
