French Foreign Minister Laurent Fabius highlighted the need for his country to regain its competitiveness in order to rebalance bilateral trade.
"Although our trade deficit with China decreased by €1.5 billion (HK$15.2 billion) in 2012, it is still very large at about €26 billion, which is 40 per cent of our overall trade deficit," Fabius told a press conference at the Hong Kong Foreign Correspondents' Club. "This rebalancing has to be an upward movement; France and China both agree that protectionism would be disastrous."
Last year, despite the global economic slowdown, France's exports to Hong Kong grew 36 per cent and its exports to China rose 12 per cent. More than 10,000 French companies are exporting up to €15 billion to the mainland and €6 billion to Hong Kong.
The former prime minister said France had to "do better". Despite several hundred companies from the mainland and Hong Kong doing business in France, foreign domestic investment inflows to France from these sources amounted to only €3.4 billion, less than a third of French FDI in China, he said.
"Competitiveness of the French economy has suffered badly over the past decade, specific measures will be soon elaborated to attract investments from China and Hong Kong as outbound Chinese investment is just starting," Fabius said.
He said that in line with comments by President Francois Hollande 10 days ago, the French government intended to lift all obstacles to incoming Chinese investment and would smooth the path on issues such as visa procedures and work permits.
During the lunch, the foreign minister also spoke of France's willingness to work with China on new fields of co-operation in support of Beijing's policy shift towards a greater focus on domestic demand.
Fabius said that although France had strong partnerships with China in the fields of aerospace and nuclear power, sectors such as the environment, health and food and beverages would also be targeted.
"China plans to double the national average revenue by 2020. This facilitates the potential development for other sectors and President's Hollande's visit has confirmed that France has a lot to offer in response to China's huge needs in the future," he said.