France is Spain’s foremost economic partner, with annual trade figures amounting to over €60 billion. We are Spain’s second biggest supplier (accounting for 11% of Spain’s imports) and its biggest customer (17.6% of Spain’s exports). France is also the third largest investor in Spain, with French investors owning 10% or more of the equity in close on 4,000 businesses.
These businesses provide over 400,000 jobs. In the financial sector, French banks are the biggest holders of Spanish government debt (5.4% of the total). In 2012, however, France saw a marked deterioration in its trade balance with Spain, which slipped into a first-ever deficit of €1.6 billion, down from a surplus of €6.4 billion in 2007. Over the past ten years, French exports to Spain have fallen from €40 billion to €29 billion.
Even so, France maintains its place as second largest supplier to Spain, just behind Germany (11.8%). Spain is France’s third biggest customer, after Germany and Italy. France continues to rank as Spain’s biggest export market, well ahead of Germany.
The automotive sector, central to bilateral trade as the leading import/export item between France and Spain, is increasingly weighting the balance of trade against France. Since 2006, France has been running a trade deficit in this key sector. By the end of 2011, the deficit had risen to €3 billion and accounts in large part for the increase in France’s overall trade deficit with Spain.
France is the most popular foreign destination for Spanish tourists and also one of the main sources of tourists heading for Spain (ranked third after Germany and the United Kingdom).
In 2011, visitors from France represented 15% of all foreign tourists visiting Spain. As the flow of German tourists shows only a limited increase (+2.5% year on year), France continues to make up ground on its neighbour across the Rhine: in 2011, Spain played host to 8.5 million French tourists compared to 9 million German visitors. The services balance, in which tourism plays a major role, continues to show France in deficit (-€4.6 billion in 2010).
The level of investments is considerable, in both directions: France continues to rank as the third largest investor in Spain (behind the United Kingdom and the United States). Of the twenty biggest companies in Spain, three are French: Carrefour, PSA and Renault. Spain was the seventh biggest investor in France in 2010: Spanish firms operate over 1,600 sites in France and provide some 75,500 jobs (mainly in textiles and clothing, energy, and in the commercial and financial sectors).
Lastly, French banks are heavily exposed to the Spanish economy: the French banking sector is Spain’s second biggest creditor overall with total exposure of €107 billion, just behind the German banks (€119 billion), and the biggest foreign banking holder of Spanish government debt (€20 billion).
Updated on 13.09.13
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