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Economic relations

Economic relations

The balance of trade between the two countries remains heavily weighted in Japan’s favour, with French exports covering around 67% of imports. Japan is France’s second largest trading partner in Asia after China (since 2003), its 11th biggest supplier, its 13th biggest customer and its 12th largest trade deficit in 2011. French exports to Japan have been declining since 2008 due to the slowdown in the world economy, but so, too, have French imports from Japan, reducing our trade deficit to €2.8 billion in 2011 (down from €7.3 billion in 2000). Pharmaceutical products are now our biggest single export item, ahead of garments, leather goods and footwear, and then wine.

The Japanese archipelago is the principal destination for French investment in Asia, and this success does much to make up for the persistent trade deficit. The stock of French direct investment in Japan at the end of 2011 stood at US$19 billion, making France the third largest investor in Japan behind the USA and the Netherlands (ahead of the UK and Germany), with a strong industrial and financial component.

The success of the alliance between Renault and Nissan, initially something of a gamble, has made a significant impression on Japanese public opinion. Renault is still one of the leading French investors in Japan, along with AXA and BNP Paribas. The number of Frenc businesses in Japan levelled off at around 480 in 2011 (compared to just 200 in 2000).

Japan is the biggest Asian investor in France. France attracts 2% of Japan’s foreign direct investment (FDI), and ranks third in Europe behind the Netherlands and the UK. Japan has a substantial presence in France, with close on 440 businesses employing some 70,000 employees. Japanese investment in France is much appreciated for its quality and compliance with social and environmental standards.

In the wake of the earthquake and tsunami of 11 March, France responded by despatching technical and humanitarian aid (blankets, drinking water, radiation protection and detection equipment) on a large scale, as well as offering Japan further aid during the rteconstruction phase.

Updated on : 31.01.13

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