Multinationals, trade balance and productive fabric (France 2000-2015)

Multinational enterprises (MNEs) are, by nature, in favorable position to export. Their weight increased during the last 20 years and they account for more than half of employment and VA of French economy. Yet, the French trade balance of manufactured products has turned to deficit between 2000 and 2015. We analyze contributions of different categories of firms (French controlled MNEs, Foreign controlled MNEs, French-French firms) to French trade balance by using individual quasiexhaustive data to rebuild national aggregates and analyze their composition. We produce an original new longitudinal database, of microdata, named BAL-XMF. The different categories of enterprises have opposite contributions to trade balance: French controlled MNEs constantly generate a surplus, since Foreign controlled constantly generate a deficit, and French-French generate also a deficit. On a deterioration of €39.8 billion in the trade balance for industrial products, the deficit of foreign controlled MNEs widens by €32.1 billion, while that of French controlled MNEs no longer offsets it and decreases (-€3.5 billion). Thirdly, changes in the composition of these different populations (takeovers, divestments, demographics, or category changes, named “circulations” of legal units) play a decisive role in the various trends. This also reflects the transformations in the fabric of the French production system (employment, value added, activities). Disaggregating the national production system according to the "MNE" dimension appears essential. This should lead to thinking beyond aggregates. Finally, the role of "circulations" of legal units encourages viewing the firm as a complex, multi-level entity.