luxury, aeronautics, what damage to fear in our export sectors?

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Capital: What are the main French sectors that export to the United States?

Sylvian Bersinger: French industry exports enormously to the United States. Among the key sectors: aeronautics and space, pharmacy, wines and spirits, machinery, perfume and cosmetics, ships and cruise ships and even leather goods. (In 2023, France exported 45.2 billion euros of products to the United States, brought by aeronautics to 7.9 billion euros, pharmaceutical products to 4.1 billion euros and drinks at 3.9 billion euros, according to the General Directorate of the Treasury, editor's note).

In his campaign program, Republican candidate Donald Trump insisted on the establishment of customs barriers. What is he claiming?

Today, trade between France and the United States is taxed very little, it is liberal trade. But that may change! Donald Trump proposes to apply a tax rate on all American imports of 10%, or even 20%. Chinese imports would be taxed at 60%. Afterwards you have to be careful because there is what Donald Trump says and what he is really going to do.

Why does he want to introduce customs barriers?

By activating the protectionism card, he wishes to give an advantage to American industry which would make it possible, via a drop in imports, to fill the trade deficit for the benefit of American factories.

Why do you think this measure would be counterproductive?

First of all, we must not forget that the United States is in a situation of full employment. The country therefore does not have the workforce necessary to produce all the foodstuffs it would stop importing. The drop in imports would also reduce the demand for foreign currencies from the United States, which would lead to a strong appreciation of the dollar. In addition, the increase in customs duties would lead to an increase in consumer prices in their domestic market, and would therefore plunge the country into a new inflationary situation. Ultimately, increases in US customs duties would lead to a drop in imports but also a drop in US exports. The American economy would be weakened.

What could be the response of France and other countries if these customs taxes are applied?

The risk is that all other countries will “protect” themselves and in turn introduce taxes on imported products, which would plunge the world into a trade war.

If this measure is put in place, would French companies have an interest in setting up in the United States to avoid being subject to these taxes?

If French manufacturers decide to set up production tools in the United States, they would in fact escape customs tolls for products intended for the local population. On the other hand, they would be taxed on the importation of their components. So that's not really a good solution.