THE CROSS-CHANNEL INSTITUTE PUBLISHES THE 2ndnd BAROMETER OF FRANCO-BRITISH ECONOMIC RELATIONS: With €97bn (+6%), the dynamic growth in trade reflects companies’ Brexit preparations
21st November 2019 - Paris, France - The "Cross-Channel Institute" Think Tank publishes its 2nd barometer of Franco-British economic relations for 2018, with initial trends for 2019. The dynamic of trade between the two countries continues with a total of €97bn in 2018, up 6% from 2017 (€92bn), including a 12% increase in services alone (€37bn vs. €33bn in 2017), linked to Brexit preparations. France and the United Kingdom remain close partners in 2018 with Foreign Direct Investments (FDI) up 8% bilaterally.
Regarding trade of goods (relatively stable at €60bn), it was mainly the export of wine, spirits and tobacco that supported France's surplus with the United Kingdom (+€2.5bn). On the British side, it was machinery and transport equipment (+€1.8bn), as well as fuels and energy (+€0.2bn) where there is a trade surplus.
Bilateral growth was strongest in trade of services (+12%). Companies' preparations for Brexit are reflected in the "Other Services" sector (+€2.6bn), which includes services such as legal and tax advice, consulting, trade services (customs tariffs), etc. It is therefore a sign that companies have prepared for the deadline on both sides of the Channel.
Over the first 8 months of 2019, and in the trade of goods alone, the growth in bilateral transactions was significant, with an increase of 7.4% between 2018 and 2019 over the same period, probably a sign that non- perishable food products were being stockpiled.
Created in January 2019 as part of the strategic partnership of its three founding members - the Franco- British Chamber, the international audit firm PwC and the British DIT* - the " Cross-Channel Institute for the promotion of Franco-British sustainable prosperity" is an independent Think Tank aimed at fostering the development of Franco-British business relations over the long term. The Institute publishes the Barometer of Franco-British Economic Relations, the only resource providing a comprehensive, dynamic and detailed overview of trade in goods and services between the two countries.
Thierry Drilhon, President of the Franco-British Chamber, said: "Since the referendum, in the face of Brexit uncertainty, the Franco-British Chamber has tirelessly supported its member companies with a pragmatic, positive and constructive approach. We are preparing ourselves for the post-Brexit era to transform this challenge into an opportunity. An opportunity to revisit Franco-British economic relations. An opportunity to enhance the attractiveness of the French and British marketplaces. This 2nd barometer confirms the strength of trade between two long-term strategic and economic partners. It is a reliable source of strategic thinking and decision-making for international leaders of large companies, but also small to medium ones, who need to consider their business value chains between our two countries.”
* Department of International Trade
Jimmy Zou, Partner at PwC France, commented: « This 2nd Cross-Channel Institute Barometer confirms the readiness of large companies that have thoroughly assessed the impact of Brexit on their value chain. No one has anything to gain from chaos, and we believe that after a period of adjustment during the renegotiation of the treaties, trade volumes will remain high with a likely redistribution of flows. Following the implementation of the Withdrawal Agreement, trade between the two countries will continue and mergers & acquisitions will gradually regain momentum.
Paul Taylor, Deputy Director, Department for International Trade (DIT), British Embassy in France, added: "The figures and analysis presented in this 2nd Barometer provide an in-depth understanding of Franco- British trade relations, and in particular the sectors of growth and the potential for the future. It is a useful reminder that France and the United Kingdom are major economic partners and will continue to create jobs, growth and opportunities together in the years to come”. ".