France’s current account balance is dominated by large companies’ offshoring

When we look at France’s current account balance, we see: A sizeable trade deficit, which results from deindustrialisation and industrial offshoring; A more or less balanced current account, thanks to the income from capital held abroad. This shows the key role played by large French companies: they have offshored and invested abroad, which has skewed the trade balance but not the current account balance thanks to the income received from these investments abroad. But the nature of the income is different: it is no longer wages (which have been lost to offshoring) but capital income repatriated by large French companies.