The Dynamics of the Development of French Export Activities in the Transition to a Post-Industrial Economy

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Introduction The prevailing geopolitical and economic conditions (Tebekin, Allayarova, 2024) of the permanent pressure of the collective West on the Russian Federation[10] in the context of the ongoing hybrid war against our country (Tebekin, Allayarova, 2023), including sanctions[11], determine the objective need to find ways to effectively develop the national economy. When achieving the goal of effective development of the national economy in modern conditions, the minimum task is to win back the domestic market through import substitution, and the maximum task is to increase exports of not only raw materials, but also high-tech products as evidence not only of technological sovereignty, but also of the international competitiveness of domestic products. In this regard, it is of interest to consider the experience of developing export activities of other leading countries of the world, which predetermined the choice of the research topic. Both Russian and foreign scientists are working on this research topic: L.E. Westphal (1990), H. Pack & Page, John M.Jr. (1994), R.E. Evenson & L.E. Westphal (1995), R.R. Nelson & H. Pack (1999), W. Becker, S. Erhart & M. Saisana (2018), A.V. Tebekin & N.I. Allayarova (2023, 2024). The purpose of the presented research is to analyze the dynamics of the development of French export activities during the transition to post-industrial economy in order to take into account both positive experience and shortcomings of one of the leading European countries in the development of export activities of the Russian Federation. Research methods During the research, the basic methods inherent in scientific research in economics were used: methods of analysis and synthesis, graphical method, methods of induction and deduction, methods of historical and logical approaches, the method of an integrated approach, the method of scientific abstractions, the method of observation and collection of facts, the method of generalization, the method of a systematic approach, etc. In the implementation of scientific methods of observation, collection of facts and generalization, the information base of research was made up of up-to-date information and analytical materials revealing the dynamics of the development of French export activities in modern economic conditions: statistical collections of the General Directorate of the Treasury, research of the Research Center for Economic and Business Development “Rexecode”, official websites of the Ministry of Economy, Finance, Industrial and Digital Sovereignty, Bank of France, Business France, Bpifrance, Team France Export, etc. Results The shift of the “centre of mass” of economic development from the West to the East, which has occurred in recent decades (Young-Chan Kim, 2020) has led to a significant weakening of the positions of several G7 countries, including France, in the global economy in general, and in foreign economic activity in particular. Thus, if in 2005 France ranked fifth in the world in terms of exports, in 2020 it has fallen to the tenth position in this rating (see Table 1). Similarly, among the G7 countries, the UK moved from sixth to fourteenth place in the world ranking of exporting countries between 2005 and 2022, while, for example, India moved from twenty-third to seventeenth place and Vietnam from twenty-fifth to sixteenth place in the same period (see Table 1). Analysing the French economy, it should be noted that, despite a certain loss of positions in the global economy, foreign trade continues to be one of the main factors of its economic development and maintaining the competitiveness of the national industry. This is eloquently evidenced by the outstripping growth of export operations compared to the country’s GDP growth. Thus, the export quota of the French economy (considering trade in goods and services) grew after the Second World War and increased over 70 years (1949-2019) from 14 % to 31.6 % of GDP. It is true that in 2020 the export quota fell to 27.9 per cent of GDP, a consequence of the global economic crisis triggered by the COVID-19 pandemic and affecting virtually all sectors of the national economy, not only in France but in most of the the world’s countries (Tebekin, Allayarova, 2023). Export sectors such as aerospace (exports declined by -45.5 %), petroleum products (43.6 %) and automobiles (21.8 %) suffered a strong negative impact during the COVID-19 pandemic period (Revenko, Revenko, 2021). This factor of temporary “freezing” of many operations on physical movement of people and goods has certainly affected the scale of foreign trade operations worldwide (Belyaev, Bolycheva, Semenov, 2022; Erokhin, 2021). As of 2023, France was once again ranked 5th in the world in terms of exports. But at the same time, France has maintained a trade deficit for two decades, which in 2022 it reached a record high of €163.6bn (almost 4 % of GDP), both historically (since 1948) and within the Eurozone. The deterioration of France’s trade balance from 2016 to 2022 (Figure 1) is explained by the low dynamism of exports of goods (primarily industrial goods: aerospace equipment, automobiles, machinery and equipment and textile products) compared to the dynamism of imports. The deterioration in France’s export performance has led to a trade balance that has become more deficient than in most other European countries, with the exception of the United Kingdom. Thus, in the period from 2005 to 2023, France’s trade balance deteriorated by 75.4 billion euros[12][13], while during the same period Italy’s trade surplus increased by 55.5 billion euros, and Germany’s trade balance by 50.9 billion euros[14]. An important trend in France’s foreign trade balance is the country’s high dependence on energy imports, the shortage of which affects almost all industrial sectors of France. This dependence is the main reason for the significant deterioration of the trade balance in 2022, as in connection with the energy crisis initiated by the United States (Tebekin, Allayarova, 2023), The cost of energy resources in this period reached 115 billion euros compared to 45 billion euros in 2021, which accounted for 86 % of the worsening trade deficit compared to 2021. Due to a number of factors (the conflict on the territory of Ukraine, inflation, supply tensions, the cost of raw materials, etc.), France was forced to massively import energy raw materials at sharply rising prices. Since 2019, the volume of imported electricity has increased 42 times in value terms, gas alone accounts for 59 billion rubles. the euro deficit. However, there is a significant surplus in the service sector. At the same time, France has a significant surplus in services. According to the study “Competitiveness of France in 2022” conducted by the Research Center for Economic and Business Development “Rexecode”[15], the terms of trade in industrial goods have been deteriorating over the past five years. In particular, the producer price index in foreign manufacturing markets increased in France by 17.5 % between 2019 and the first three quarters of 2022, while the price index for imports of manufactured goods increased by 18.9 % over the same period, which caused a deterioration in the terms of trade by 1.2 %, which was recorded in 2021, when the acceleration of import prices was more noticeable than the acceleration of export prices[16]. Rexecode researchers, based on the results of a survey among importers from European countries, attribute France’s declining export market share in recent years to the fact that the prices of French products are too high compared to their quality, which worsens the value for money and thus their overall competitiveness compared to other leading EU exporting countries (Figure 1.). years Aeronautics and spacePerfumes, cosmetics, chemistry. Agri-food sectorPharmaceuticals EnergyCapital goods Automobile industryMetallurgy Textiles, clothing, leatherElectronics, IT Export of goodsImport of goods Trade balanceЛинейная (Trade balance) Figure 1. Dynamics of France’s industry balance for the period 2016-2023 (billion euros) Source: compiled by the authors based on French foreign trade reports of the General Directorate of the Treasury (Rapport 2024 sur le commerce extérieur de la France). Retrieved March 15, 2024, from https://www.tresor. economie.gouv.fr/Articles/tags/Commerce-exterieur However, the loss of France’s long-term export market share is explained by Rexecode experts as a result of non-price competitiveness factors (quality and innovation, brand image, after-sales service, etc.), which reflect an economy’s ability to increase its share of the world market without having to lower its prices compared to competing economies in other countries, in other words, to offer competitive products in favor of the needs of a society that is more likely to be willing to buy the goods on offer than to buy them. According to the Rexecode survey, as of 2022, only three French sectors were characterised by high non-price competitiveness: aircraft, leather goods and wine. These industries stand out for their quality, innovation and strong brand image, which contribute to successful non-price international competitiveness. However, France is inferior here (In terms of structural competitiveness or also called “non-price competitiveness”) Germany, which has a high non-price competitiveness in a large number of sectors (plastic products, non-ferrous metals, automotive parts, electrical products, etc.), being one of the world leaders in these industries, which account for a significant share of German exports. It should be noted that German products are rated as more profitable in terms of price-quality ratio than French (not counting pharmaceutical and cosmetic products) (Becker, Erhart, Saisana, 2018). The analysis shows that France’s trade deficit is a consequence of higher rates of deindustrialization among large, industrialized countries. France, meanwhile, has experienced the most marked deindustrialisation in the last forty years among developed European countries, in particular, the share of industry in GDP has decreased by 10 points since 1980 to 13.5 % in 2019, compared with 24.2 % in Germany, 19.6 % in Italy and 15.8 % in Spain[17]. Since non-price competitiveness and related development strategies and investments are key elements of success in entrepreneurship in the modern foreign economic environment (see Table 2), it should be noted that non-price competitiveness provides significant opportunities for differentiation and the formation of added value, which are necessary for businesses in the foreign trade sector for sustainability and growth. Tracking the negative export dynamics and analysing its causes, the French government has taken a variety of measures in recent years to improve the competitiveness of its companies on the world market. These include initiatives aimed at encouraging investment and supporting companies in their quest to increase competitiveness, especially if it is competitiveness based on inflated prices. The implementation of these measures is reflected in the Welsh Report, the Pact on Responsibility and Solidarity, as well as the Tax Benefit on Competitiveness and Employment (CICE)[18][19]. Speaking about the competitiveness of French exporting companies in foreign markets, the following should be noted. To date, the number of French small and medium-sized enterprises in foreign markets is significantly less (109 thousand) compared to the leading European countries (297 thousand in Germany, 222 thousand in Italy, 166 thousand in Spain, 118 thousand in the UK, 115 thousand in the Netherlands). Figure 2. shows the percentage of small, medium and large businesses in France’s exports from 2015-2019, which demonstrates that large companies have the largest share of the country’s exports (53 %), 34 % of medium-sized companies, and only 13 % of total exports come from small businesses Table 2 The rating of 10 exporting countries according to the estimates of the average European buyer for the 4 sectors studied in 2022 1. Clothing and accessories Quality 2 1 5 4 7 8 6 3 10 9 Ergonomics-design 2 7 5 1 9 6 4 3 10 8 The content of technological innovations 7 4 2 3 9 6 5 1 10 8 Brand awareness 1 2 3 6 7 8 4 5 9 10 Delivery dates 2 1 4 8 7 6 5 3 9 10 Product-related services 4 1 6 2 5 3 7 8 9 10 Supplier diversity 4 8 10 2 7 6 3 9 5 1 Price 7 8 6 9 10 2 4 5 1 3 Value for money 3 2 5 8 6 4 7 1 10 9 Non-price criterion 1 2 6 4 7 8 5 3 10 9 2. Housing equipment Quality 4 2 6 3 9 8 7 1 5 10 Ergonomics-design 6 3 10 2 7 5 4 1 9 8 The content of technological innovations 8 2 4 5 10 9 3 1 7 6 Brand awareness 6 4 5 3 9 7 2 1 8 10 Delivery dates 3 2 5 6 1 4 8 7 10 9 Product-related services 2 3 6 4 7 5 8 1 10 9 Supplier diversity 7 1 8 5 10 9 6 3 4 2 Price 8 4 9 7 6 5 10 2 3 1 Value for money 6 2 8 10 5 4 9 1 7 3 Non-price criterion 4 2 6 3 8 7 5 1 9 10 Pharmaceutical and cosmetic products Quality 3 2 7 6 9 8 1 4 5 10 Ergonomics-design 1 6 7 3 10 5 2 4 8 9 The content of technological innovations 3 4 7 5 10 9 2 1 6 8 Brand awareness 3 1 5 4 10 7 2 8 6 9 Delivery dates 4 1 7 8 5 2 6 3 9 10 Product-related services 8 6 10 7 4 3 2 1 5 9 Supplier diversity 6 1 10 7 9 3 5 4 8 2 Price 8 9 7 10 6 5 4 2 3 1 Value for money 3 8 10 9 7 4 6 2 1 5 Non-price criterion 4 3 8 6 9 5 1 2 7 10 Agro-food products Quality 1 2 6 4 8 3 7 5 9 10 Ergonomics-design 2 7 6 3 9 4 1 10 5 8 The content of technological innovations 3 4 10 6 8 2 1 9 5 7 Brand awareness 2 7 5 1 8 6 3 4 10 9 Delivery dates 2 1 4 6 7 5 3 8 10 9 Product-related services 4 1 8 5 7 2 3 6 10 9 Supplier diversity 5 6 4 1 9 3 2 8 10 7 Price 4 1 10 6 8 2 7 5 9 3 Value for money 5 1 10 7 6 3 2 4 8 9 Non-price criterion 2 1 6 5 8 4 3 7 9 10 Consumer goods (total) Quality 2 1 6 4 8 7 5 3 9 10 Ergonomics-design 3 5 7 1 10 6 2 4 8 9 The content of technological innovations 4 3 6 5 10 7 2 1 9 8 Brand awareness 1 3 6 4 8 7 2 5 9 10 Delivery dates 2 1 5 8 4 3 7 6 9 10 Product-related services 5 2 8 6 7 3 4 1 9 10 Supplier diversity 6 2 10 3 9 5 4 7 8 1 Price 8 5 10 9 7 4 6 3 2 1 Value for money 5 1 9 10 6 3 4 2 8 7 Non-price criterion 3 1 7 5 8 6 4 2 9 10 Source: compiled by the authors based on “La compétitivité française en 2022. Recul endigué des parts de marché mais déficit extérieur record. Document de travail n° 84. Janvier 2023”. Retrieved March 15, 2024, from http://www.rexecode.fr/public/Analyses-et-previsions/Documentsde-travail/Competitivite-de-la-France-du-mieux-en-2022-mais-un-deficit-exterieur-record 2015 2016 2017 2018 2019 Large companies, % 51,1 53,7 51,8 53,0 53,0 Medium-sized companies, % 33,7 32,5 34,9 34,0 34,0 SMEs, % 15,1 13,8 13,3 13,0 13,0 60,0 50,0 40,0 30,0 20,0 10,0 0,0 Figure 2. Distribution of export volumes between large companies, medium-sized companies and small businesses in France 2015-2019 Source: build dy the authors based on: Rapport 2024 sur le commerce extérieur de la France. Retrieved March 24, 2024, from https://www.tresor.economie.gouv.fr/Articles/tags/Commerce-exterieur compiled by the authors on: Rapport 2024 sur le commerce extérieur de la France. Retrieved March 14, 2024, from https://www.tresor.economie.gouv.fr/Articles/tags/ Commerce-exterieur However, it is obvious that the factor of relatively small share of small and medium-sized enterprises in France as compared to other leading European countries cannot be considered as determining the weakness of the French export system, since the above differences between countries are explained, first of all, by the structure of their production systems, peculiarities of methods of accounting for structural groups of business, methods of calculating the number of exporters, etc. It should be noted that the number of French exporting companies increased by almost 17 % from 2015-2023 (see Figure 3). At the end of 2022, the growth of French exporting companies was 6.2 % compared to 2021, which indicates a relatively intensive dynamics, since in 2023 the growth was only 1.2 %. At the same time, the number of French exporters now exceeds the pre-crisis level, which is a certain indication of the strengthening of France’s export potential (see Figure 3). It should be noted that the French government’s efforts to increase export potential have not been slow. Already in 2023, France’s trade balance has improved by more than 39 per cent, from minus 163.6 billion euros in 2022 to minus 99.6 billion euros in 2023[20]. 2015 2016 2017 2018 2019 2020 2021 2022 2023 Years Large companies, % Medium-sized companies, % SMEs, %Number of French exporting companies Figure 3. The number of French exporting companies for the period 2015-2023 Source: compiled by the authors on: Rapport 2024 sur le commerce extérieur de la France. Retrieved March 14, 2024, from https://www.tresor.economie.gouv.fr/Articles/tags/Commerce-exterieur As a percentage of the total number of French exporting companies, equal to 125,283 in 2018, small enterprises predominate (more than 95 %), while mediumsized enterprises account for 4 % and 0.4 % of large companies, respectively. According to the results of a survey conducted by Eurobarometer, in 2015 about 15 % of French small enterprises supplied goods for export, and in the period from 2016-2019 even less - 13 % (see Figure 2), while the average for the EU this figure reaches 29 %. At the same time, the share of foreign markets in the total turnover of French small enterprises involved in exports - 27 % is relatively lower than the EU average of 32 % in the EU, which indicates the insufficient desire of French small enterprises to carry out export activities, largely due to obstacles encountered in the implementation of export supplies. At the same time, empirical data show that firms involved in export operations are more productive, larger, retain their competitive advantages longer, and pay higher wages than firms focused only on domestic commodity markets (Nesta, Bellone, Musso, Quere, 2008). According to a number of researchers (Westphal, 1990; Pack, Page, 1994; Evenson, Westphal, 1995; Nelson, Pack, 1999), firms operating in export markets have access to knowledge (primarily scientific knowledge) and technical experience other than knowledge and experience in domestic markets, including new developments and new methods of production and application of innovations. The presence of such experience leads to an increase in the production efficiency of exporting firms: constant increase in labor productivity, improvement of quality and volume of products, reduction of production costs (Tebekin, Allayarova, 2024), this, in turn, has a positive impact on the country’s export potential, which is an important factor in economic growth. The increasing complexity of the sale of goods on export markets and the intensification of the struggle for a buyer are forcing national and international politicians to increase the volume of export assistance to firms in rich and poor countries (Montgomery, Lages, 2001). It is well known that, in general, the export assistance provided has little effect on export performance, this is due to the fact that exporters use the support they receive to develop pricing strategies (studying market conditions, demand and price dynamics, forecasting new needs, etc.) (Gencturk, Kotabe, 2001). Export indicators include the cumulative results of export sales of the exporting company (Shoham, Albaum, 1994). Many researchers note that export performance is strongly influenced by the company’s export strategy - product strategy, segmentation strategy, choice of export markets, etc. (Cavusgil, Zou, 1994). Such parameters as foreign direct investment, which go beyond the financial and managerial capabilities of these companies, as well as innovative products with competitive advantages, also play an important role in this (Cooper, Kleinschmidt, 1985). It is well known that in any business model, especially in those where the main vector for any country is set by the need to maximize revenues, rates of socio-economic development through exports, innovations are fundamental in ensuring production and export capacity (Delenda, 2021). However, export performance is directly affected by the degree of export assistance, the degree of price adjustment to the main foreign market, as well as the company’s experience in managing business processes in the face of ongoing changes and the development of competition caused by the transition from a seller’s market to a buyer’s market. The research has shown that France’s export support system is not without its shortcomings. This system, which consists of many elements with complex interrelationships, contains both duplication and parallelism of functions and certain functional “white spots”, i.e. gaps in the realization of the country’s export potential. It should be noted that the essence of effective support for business development and export of products, including agri-food products on the European and world market lies in three initiatives (Zubkova, 2021): y supporting companies in the long term; y opening new markets and providing access to existing markets; y product promotion, i.e. giving the product a certain level of competitiveness in foreign markets. But given the positive dynamics of France’s export activity in recent times, let’s analyse at what expense these achievements were realized? The analysis has shown that in France the export support system includes the following elements (institutions), which are a set of components linked by a common process of achieving the goals set within the framework of the relevant programs and can be divided into four groups of participants: y the State with the ministries concerned (the Ministry of Economy, Finance, Industrial and Digital Sovereignty and the Ministry of Europe and Foreign Affairs, regional economic development agencies); y public and private operators (Team France Export - TFE, Team France Invest -TFI); y companies and business federations (Chambers of Commerce and Industry - CCI France), including chambers of commerce and industry abroad (CCI France International), foreign trade consultants, Medef, Meti, etc; y financial actors involved in export financing and insurance (Business France, Bpifrance). Let’s take a closer look at the activities of these groups of participants from the standpoint of highlighting the positive features of their activities. In the group, the state, represented by the ministries concerned, stands out: Firstly, the Directorate-General for Globalisation, Culture, Education and International Development, which leads the policy of international development, on foreign trade issues; coordinates the work of the embassy network in the field of exports; and together with the Ministry of Economy, Finance, Industrial and Digital Sovereignty and the Ministry of Territorial Unity oversees Business France. Secondly, the General Directorate of the Treasury (Direction générale du Trésor - DG Trésor)[21], under the Ministry of Economy, Finance, Industry and Digital Sovereignty, manages Business France’s activities and is the initiator of state guarantees through the Bpifrance export insurance agency. Thirdly, the General Directorate of Customs and Indirect Duties (Direction générale des douanes et droits indirects - DG DDI) provides support to companies facing customs formalities in the course of their activities through business counselling departments. At the central level, DG DDI coordinates the activities of economic policy centres, responds to questions from companies regarding mandatory tariff information and monitors the economic development of other countries. In the group of public and private operators, the following stand out: Firstly, Team France Export, created to coordinate the actions of public organisations, regional structures, chambers of commerce and industry, as well as Business France, Bpifrance in the framework of the development of exports of French companies, especially small and medium-sized enterprises (SMEs). It should be noted that Team France Export is a specially created public service to support French businesses internationally[22]. The creation of Team France Export in 2018 ensured that the resources of the entities involved in export support were pooled into a single mechanism that aims to provide the final, i.e. products delivered to consumers, according to their requests. This mechanism includes a set of export facilitation services at all stages of export contract fulfilment, including finding a buyer; financing the transaction; and providing transaction insurance. Based on this, the TFE activity is constructed, which is realised by means of the following structural elements[23]: ya digital platform shared by Business France, Bpifrance, CCI and the regions, through which a set of functions on issues related to public support and financing of export contracts are performed, allowing mutual and personalised monitoring of companies. At the same time, this platform assumes the participation of private sector entities, whose most interesting proposals are placed on this platform within the framework of the abovementioned directions; y“single correspondent” of Team France Export abroad is envisaged to form a network of trusted third parties outside France from the public and private sectors, selected by Business France, who will base their work on common regulations, standards and information systems to support export activities; y“single window” in each French region makes it possible to provide information, advice to French enterprises (especially SMEs) on business, international development and their exports, and services to public and private companies. It should be noted that within the framework of the “Dare to export” Plan (“OSEZ L’EXPORT”) One of the main measures is the implementation of the “Export Academy” Program (“L’Académie de l’Export”), which is designed to promote export preparation, in particular the enhancement of professional knowledge, skills related to export activities[24]. The program unites all participants of Team France Export (Bpifrance, Business France, Chambers of Commerce and Industry), which offer various training courses, trainings (In different formats, different duration) related to export activities (how to prepare, define strategy, find financing, manage risks, which markets to enter, how to negotiate, how to manage logistics, how to create and lead a team, how to communicate, how to organise a business, etc.)[25]. For French company managers who are already involved or interested in international business, as well as for export teams, the “Export Academy” provides various types of training: yqualified trainings, certified by Qualiopi, can be conducted either in person or remotely and can be funded through training funds; ytechnical seminars on a specific topic with the participation of experts in the relevant field, either in person or remotely; yself-learning: based on the company’s practical experience, a set of tools (training videos, training manuals, etc.) is offered. As an example, the Bpifrance educational program “International Immersion in Innovation”, through which French entrepreneurs can gain basic knowledge in the field of foreign economic activity. Thus, French exporters can gain professional knowledge and international business skills by choosing the right training format, whether the exporter is experienced or a beginner. Speaking about the “Dare to export” Plan (“OSEZ L’EXPORT”), it is worth noting that this is a new plan aimed primarily at supporting small and medium-sized businesses that are starting their export activities. The Export Program plans to implement 13 measures to internationalize French companies within the allocated budget of over 120 million euros. Significant efforts will be made to achieve the main goal of the plan - to increase the number of French exporting companies to 200 thousand by 2030 (currently their number reaches 146,200). It should be noted that the Export Strategy highlights three priorities in this plan[26]: y investments in “human capital”, in particular the creation of a “territorial export volunteer”, a mechanism to help recruit young people involved in exporting, and the creation of an “Export Academy” to “prepare current and future entrepreneurs to meet the challenges of exporting”; y creation of a “Pavillon France pour tous” (Pavillon France pour tous), which will support 5,000 companies per year at international exhibitions at the expense of budgetary funds, as well as the creation of a “brand of France” to promote and strengthen the image of French products abroad; y “Preparing for the future” involves support measures such as: individual export support for 1,000 SMEs supported by the “France 2030” plan and allowing 200 SMEs with “strong export potential” to benefit from intensive collective “Booster” support, 60 % of which is paid for by the state. Much of the above has already been created and is being implemented with regard to export support institutions. Secondly, Team France Invest, designed to promote employment, economic growth by providing financial support to enterprises (start-ups, SMEs), as well as financial and legal expertise, etc. In the company group and business federations are distinguished: Firstly, the French Chambers of Commerce and Industry as a network of public administrative institutions representing the interests of industry, commerce and services to public authorities, acting as intermediaries between the state and business. The main tasks of the French Chambers of Commerce and Industry are to support and advise on the international development of French enterprises and the export of their products, as well as to establish contacts with partners and provide various information related to export activities. Secondly, Chambers of Commerce and Industry abroad (CCI France International) to promote business relations and contacts abroad. The group of financial entities involved in export financing and insurance includes: Firstly, Business France is the French government agency for the international development of French business, the creation of conditions to attract international investment in the French economy and the economic development of France[27], is triply subordinated to the Ministry of Economy, Finance, Industrial and Digital Sovereignty, the Ministry of Europe and Foreign Affairs and the Ministry of Territorial Unity. The main functions (duties) of Business France are: y international development of enterprises and export development, primarily of small and medium-sized and medium-capitalisation enterprises; y development of international corporate volunteering; y stimulating foreign investment in the French economy; y promotion of France’s economic image abroad. Secondly, Bpifrance, which is the main operator of Team France Export, which manages various guarantees on behalf of the state, offers export financing solutions to support microenterprises, SMEs and medium-cap companies, as well as large companies. In relation to the promotion of export activities of French enterprises, Bpifrance provides:With regard to the promotion of export activities of French enterprises, Bpifrance provides: y loans to French exporting companies and foreign buyers of French products; y financial guarantees for loans issued by commercial banks; y guarantees for deposits made by participants in international tenders; y government export guarantees through its subsidiary Bpifrance Assurance Export. It is worth noting that Bpifrance and Business France provide consulting services as part of their “Diagnostics of International Technological Partnership” program, which aims to encourage French small and mediumsized businesses to participate in international research, development, and innovation projects. The consulting service is provided by a qualified expert from Bpifrance and is designed to assist with[28]: y support of SMEs in the preparation of technological partnerships within the framework of an R & D project (partnership research, drafting and approval of a consortium agreement, legal assistance, etc.); y supporting SMEs in the preparation of their application for participation in joint intergovernmental, European or transnational projects[29]. In addition, Bpifrance is the developer of one of the leading online platforms “EuroQuity” for finding investors, partners in Europe to scale a company, from SMEs, mid-capitalisation companies (mid-sized companies) and start-ups. This platform offers additional services for French companies, such as accelerator programmes funded by the European Commission, digital training, coaching sessions, etc.[30]. Bpifrance Assurance Export is a French agency that supports and encourages French companies and banks to export their products and services. Their main goal is to boost French exports by providing insurance for companies and banks (see Figure 4). Let’s briefly comment on the export insurance services provided by Bpifrance Assurance Export[31]: y insurance of services and intangible property (Figure 4) allows French exporters to protect their contracts for servicing their activities - costs of engineering, market research, consulting services, product adaptation to market requirements, product patenting, product promotion, staff training, participation in fairs; y pre-financing insurance (Figure 4) assumes working capital insurance covers the lending bank against the risk of non-payment by the French exporter in case of delayed payment or insolvency (bankruptcy of the company); y insurance of commercial contracts realised with the use of credit funds (Figure 4) means that Bpifrance Assurance Export coverage of risks arising in the process of fulfilling obligations under a commercial contract: contract interruption, non-payment of receivables, non-payment of the loan after its maturity date and default on the guarantee; y buyer’s credit insurance (Figure 4) means insurance by Bpifrance Assurance Export of French or foreign banks against the risk of non-payment of loan instalments by a foreign buyer. The insurance covers the principal and interest on the loan and may also include periodic interest and premium if capitalised. The percentage of coverage is 95 %. And the loan term is from 2 years or more; y discount and assignment insurance on supplier credit (Figure 4) provides insurance to French or foreign credit institutions or finance companies against the risk of non-payment of receivables by a foreign debtor (for supplier credit of 2 years or more)); y letter of credit confirmation insurance (Figure 4) covers French or foreign banks confirming payment of a letter of credit against the risk of non-payment by the issuing bank of the letter of credit. The percentage of coverage can be increased from 95 to 100 % for companies with sales revenue ≤ 75 mln euros); y Bpifrance Assurance Export currency risk insurance (Figure 4) means insurance against changes in foreign currency exchange rates during the preparation and fulfilment of an export contract. This type of insurance is designed for French companies that enter export contracts in a local currency other than the euro (except for international trade transactions). Foreign exchange contract insurance allows the company to set a forward exchange rate for a currency to stabilise the proceeds in that currency, neutralising currency risk; y insurance of payments on accounts in foreign currency (Figure 4) is intended for SMEs and enterprises with fewer than 5,000 employees and revenue of less than 1.5 billion euros or a total balance of less than 2 billion euros operating in the aerospace industry. This type of insurance protects against currency risk in relation to the income of microenterprises and SMEs after signing the framework agreement. Framework agreements in the aerospace sector denominated in US dollars expose businesses to the risk of changes in the eurodollar exchange rate during the entire billing period. This insurance allows these enterprises to better control their income and provides an opportunity to stimulate export business. Insurance covers long-term currency risk (up to 5 years); y export bond insurance (Figure 4) is provided by Bpifrance Assurance Export for French companies participating in tenders. This type of insurance protects the issuer against the risk of delayed payment or insolvency of the French exporter in case the bond is claimed by a foreign buyer. For French exporters, export bond insurance simplifies the bond formalization procedure and allows them to increase their export revenues without additional costs. For banks, insurance allows them to take on more liabilities while limiting their risks. Bonds are guaranteed up to full issue, regardless of the term of the bond; y investment insurance (Figure 4) protects investors or lending institutions against political risks. Equity investments, guarantees provided for local medium- and long-term loans, bank loans to finance assets, long-term equity loans, or fees under a licence concession agreement related to a foreign company’s operations are subject to insurance; y Bpifrance Assurance Export strategic projects insurance (Figure 4) covers loans or contracts of strategic interest to the French economy (supply of commodities and energy, the project creates a competitive advantage for France, entry into a sectoral or geographical market with high growth potential or the failure to realize the project poses a risk to the national economy, industry or sector of the economy as a whole). The insurance covers the risk of non-payment in the event of losses of a political, commercial nature, under a commercial contract, shareholder or bank loan. Some types of insurance provided by Bpifrance Assurance Export are available online for French exporters (e.g. services and intangible property insurance, prefinancing insurance, export bond insurance, currency risk insurance). Another French company specialising in export credit insurance is Compagnie Française d’Assurance pour le Commerce Extérieur (Coface)[32]. Coface’s foreign trade insurance is an activity aimed at providing services worldwide, among them: y credit insurance for French enterprises (SMEs and micro-enterprises, multinationals) against various risks (commercial, political, credit); y trade credit guarantees (customs and excise guarantees) and factoring (customer payment guarantee, principal indemnity guarantee, supplier payment guarantee, standby letter of credit, market guarantees, etc.); y collection of receivables (pre-trial collection, non-recourse factoring); y business (corporate) information (economic research, risk assessment, market analysis, etc.). The French insurance market can thus be divided into two sectors: the private sector, comprising national and foreign companies operating in France, and the public sector, as well as various companies subsidized by interested ministerial departments, such as Coface, Bpifrance Assurance Export. Although the state is the sole shareholder of the national companies, these companies are run as joint stock companies and this classification of the French insurance market, although somewhat tentative, paints a true picture of the jurisdictional organisation and practical conditions under which the insurance market has developed (Outreville, 1986). In a context of deepening global economic relations and tougher competition, the role of removing all kinds of barriers for national producers to enter export markets is very important, i.e. one of the main constraints faced by French exporting companies is the ratio between premiums and insurance claims, which has been unbalanced since 2005 and especially in recent years, as well as the high cost of insurance compared to the financial capacity of some sectors (vegetables, fruit, viticulture) (Enjolras, Santeramo, 2016). Summarising the analysis, it should be noted that the peculiarities of the economic methods of supporting export activities in France are: y are based on some general rules of behaviour of exporting companies, giving the opportunity to manoeuvre resources (administrative methods are characterised by specific tasks aimed at achieving the goals of the managed system by forming its clear structure, creating appropriate conditions for the implementation of decisions); y predetermine the direction of indirect impact through a system of relations that take into account the interests of the object of management (here can be information, macroeconomic, resource (cost) and institutional methods). For example, institutional tools contribute to the coordination of economic entities and include state bodies, associations of entrepreneurs, information systems; y provides some independence of the system at all levels by assigning responsibility to it for the decisions made and their consequences (business entities come to decisions based not on the instructions of the authorities, but on an independent economic choice). This is facilitated by the focus of foreign trade and innovation policy on the self-development of companies, their survival in the changing conditions of foreign economic activity; y encourage companies to be innovative and renew their production activities (the high level of competition has favored the emergence of various business incubators, technoparks, venture funds, etc. in many developed countries). Thus, it can be stated that at the present time, a nationwide task of reforming the export support system has been set and is being successfully implemented in France. It should be taken into account that there are two groups of factors that to a large extent continue to have a negative impact on the competitiveness of the French economy: the economic ones include the size of the shadow economy, the performance of international rankings, strict laws in the labour code and in the field of taxation, changing conjuncture and lower demand for national products on world markets, etc.; the non-economic ones include unfavorable conditions for French researchers (high level of ‘brain drain’), the change of parade (Tyurina, 2019). Speaking about SMEs, it should be noted that export activities and labor force creation of SMEs are the most important characteristics that allow them to function in modern market conditions (Stewart, McAuley, 2010). However, SMEs cannot exist without active targeted support from the government (direct financing - subsidies, loans, lending, grants, insurance, etc.). Figure 4. Types of export insurance services for French companies and banks provided by the French export credit agency Bpifrance Assurance Export Source: compiled by the authors on “Bpifrance. Find investors and partners”. Retrieved April 15, 2024, from https://www.bpifrance.com/products/find-investors-and-partners/#:~:text=Created%20by%20Bpifrance%20 in%202008 %2C,and%20therefore%20guarantee%20high-quality%20service Conclusion Thus, the research has shown that the shift of the “centre of mass” of economic development from the West to the East, which has occurred in recent decades, has led to a significant weakening of the positions of a number of G7 countries, including France, in the global economy in general, and in foreign economic activity in particular. Thus, while in 2005 France ranked fifth in the world in terms of exports, in 2020 it has fallen to tenth position in this ranking. The analysis of the dynamics of the French economy has shown that, despite a certain loss of positions in the global economy, foreign trade continues to be one of the main factors of its economic development and maintaining the competitiveness of the national industry. This is eloquently evidenced by the outstripping growth of export operations compared to the country’s GDP growth. It is shown that despite the fact that, as of 2023, France has regained the 5th place in the world in terms of exports. But at the same time, France has maintained a trade deficit for two decades, which in 2022 it reached a record level of -163.6 billion euros (almost 4 % of GDP), both historically (since 1948) and within the Eurozone. It is noted that the deterioration of France’s trade balance from 2016 to 2022 is explained by the low dynamics of exports of goods (primarily industrial: aerospace equipment, automobiles, machinery and equipment and textile products) compared to the dynamics of imports. It is shown that the deterioration in France’s export performance has led to a trade balance that is more in deficit than that of most other European countries, with the exception of the UK. It is demonstrated that an important trend in France’s foreign trade balance is the country’s high dependence on energy imports, the shortage of which affects almost all French industrial sectors, which was also one of the main reasons for the significant deterioration of the country’s trade balance in 2022. Due to the energy crisis, France has been forced to import energy raw materials and masse at sharply rising prices. Since 2019, the amount of imported electricity has increased 42 times in value, with gas alone accounting for 59 billion euros of the deficit. At the same time, France has been shown to have a significant surplus in services. The current imbalance in the production and sales of tangible goods and services in France indicates that the country has set too high a pace of deindustrialization. In this sense, the dynamics of the French economy is similar in a certain sense to the development of the Russian economy. At the same time, the infantilization of managers of the national economy in Russia manifested itself in the aspirations to ensure the effective development of the national economy on the basis of technologies of the sixth technological mode, corresponding to the post-industrial era, based on technologies of the third technological mode, without serious efforts to restore production on the basis of technologies of the fourth and fifth technological mode, corresponding to the industrial era (Figure 5). The analysis shows that France’s trade deficit is a consequence of higher rates of deindustrialization among large industrialized countries. At the same time, France has experienced the most noticeable deindustrialization in the last forty years among developed European countries, in particular, the share of industry in GDP has decreased by 10 points since 1980 to 13.5 % in 2019, compared with 24.2 % in Germany, 19.6 % in Italy and 15.8 % in Spain. Tracking the negative export dynamics and analyzing its causes (including problems of price and non-price competition), the French government in recent years has taken a variety of measures to improve the competitiveness of its companies on the world market. These include initiatives aimed at encouraging investment and supporting companies in their endeavors to become more competitive, especially if this competitiveness is based on overpricing. The implementation of these measures is reflected in the Welsh Report, the Responsibility and Solidarity Pact, and the Competitiveness and Employment Tax Credit (CICE). It should be noted that the French government’s efforts to increase export potential have not been slow. Already in 2023, France’s trade balance improved by more than 39 % - from minus 163.6 billion euros in 2022 to minus 99.6 billion euros in 2023. Research has shown that France’s export support system is not without flaws. This system, which consists of many elements with complex interrelationships, has both duplication and parallelism of functions and certain functional “white spots”, i.e. gaps in the realization of the country’s export potential. However, taking into account the positive dynamics of the development of French export activity in recent times, we have analyzed the factors that allowed us to reverse the negative dynamics in export activity and to achieve significant positive dynamics. Figure 5. The destroyed technological ladder of the Russian economy, demonstrating the desire to ensure the development of the national economy based on technologies of the VI technological structure, based on technologies of the III technological structure Source: compiled by the authors. The analysis has shown that in France the export support system includes the following elements (institutions), which are a set of components linked by a common process of achieving the goals set within the framework of the relevant programmers and can be divided into four groups of participants: yFirstly, the State, represented by the ministries concerned, with specialized structures such as the Directorate-General for Globalization, Culture, Education and International Development (DGM); the Direction Générale du Trésor (DG Trésor), which manages Business France and initiates the granting of state guarantees through the export insurance agency Bpifrance; and the Directorate-General for Customs and Indirect Duties (DG DDI); y Secondly, public and private operators (Team France Export (TFE), Team France Invest (TFI)), where the implementation of the “Dare to Export” plan (OSEZ L’EXPORT), in which one of the main measures is the implementation of the “Export Academy” program (L’Académie de l’Export), is noteworthy. The main priorities of the export strategy of the OSEZ L’EXPORT plan are: investment in “human capital”, the creation of a “Pavillon France pour tous” and “Preparing for the future”; yThirdly, companies and business federations (chambers of commerce and industry (CCI France), including chambers of commerce and industry abroad (CCI France International), foreign trade consultants, Medef, Meti, etc.) representing the interests of industry, trade and services before public authorities, acting as intermediaries between the state and business, and promoting business relations and contacts abroad; yFourthly, financial entities involved in export financing and insurance (Business France, Bpifrance), which provide French exporting companies with: loans; financial guarantees for loans granted by commercial banks; guarantees for collateral deposited by participants in international tenders; state export guarantees; consultancy services; services for finding investors, partners in Europe in order to scale up the company; export insurance services. The activity of the French export credit agency Bpifrance Assurance Export deserves special attention, aimed at increasing the country’s exports by insuring the exports of French companies and banks in the following areas: insurance of services and intangible property; insurance of pre-financing; insurance of commercial contracts realized with the use of credit facilities; insurance of buyer’s credit; insurance of discount and assignment of claims on supplier’s credit; insurance of letter of credit confirmation; insurance of currency risks; insurance of payments on accounts in foreign currency intended for small business; insurance of export bonds; insurance of investments; insurance of strategic projects. Summarizing the analysis, it should be noted that the peculiarities of the economic methods of supporting export activities in France are: yare based on some general rules of behavior of exporting companies that allow them to man oeuvre resources; ypredetermine the direction of indirect impact through a system of relations that take into account the interests of the object of management; yensure some independence of the system at all levels by making it responsible for decisions and their consequences (economic entities come to decisions based not on the prescriptions of the authorities, but on independent economic choice); yencourage companies to innovate and renew their production activities. Thus, the conducted research has demonstrated that at present, with regard to the foreign trade processes in France and their regulation, the national task of reforming the system of export support, corresponding to the conditions of post-industrial economy, has been set and is being successfully solved. Taking into account that the problems of export development in the Russian economy are to some extent similar to the problems of export activity in the French economy (first of all, we are talking about the accelerated pace of deindustrialization in recent decades and overestimation of the importance of the services market against the background of underestimation of the industrial products market), it seems that the positive experience of France in adopting and implementing measures to develop export activity can be used in the development of export activity in the Russian Federation. Although it is necessary to recognize that Russia is still inferior to France in terms of the level of development of its production base, which determines its export potential.

About the authors

Nelly I. Allayarova

Samara State University of Economics

Author for correspondence.
Email: len170121@outlook.com
ORCID iD: 0000-0002-8518-021X

Lecturer of the Department of Management

141 Soviet Army St, Samara, 443090, Russian Federation

Alexey V. Tebekin

Lomonosov Moscow State University

Email: Tebekin@gmail.com
ORCID iD: 0000-0002-3098-7710

Doctor of Technical Sciences, Doctor of Economic Sciences, Professor, Honorary Worker of Science and Technology of the Russian Federation, Professor of the Higher School of Cultural Policy and Management in the Humanitarian Sphere

1 Leninskie Gory St, Moscow, 119991, Russian Federation

Bata I. Ketsba

Russian Customs Academy

Email: ketsba94@mail.ru
ORCID iD: 0009-0007-4159-7789

PhD in Law, Head of the Department of Coordination, Maintenance of Scientific Work and Doctoral Studies

4 Komsomolsky Av., Lyubertsy, 140015, Russian Federation

References