Economic Analysis
United States of America

United States of America

Population 321,601 million
GDP 56 084 US$
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major macro economic indicators

  2014  2015  2016 (e) 2017 (f)
GDP growth (%) 2.4 2.6 1.6 1.8
Inflation (yearly average) (%) 1.6 0.1 1.2 2.1
Budget balance (% GDP) -4.2 -3.5 -4.1 -4.3
Current account balance (% GDP) -2.2 -2.6 -2.4 -2.7
Public debt (% GDP) 104.7 105.2 108.2 108.4


(e) Estimate   (f) Forecast


  • Flexibility in the labour market
  • Full employment is one of the objectives of the Federal Reserve
  • Predominant role of the dollar in the global economy
  • Nearly 60% of public debt held by residents
  • Growing energy self-sufficiency 


  • Low employment rate
  • Households’ reduced geographic flexibility
  • Polarisation of political landscape
  • Lower fertility rate
  • Obsolescence of many infrastructures


Mr Trump's fiscal stimulus, a modest boost to growth

In 2017, activity should start again, but the magnitude of the acceleration will remain modest. Despite an economic program supposed to double the pace of US growth to 3.5-4%, President Trump appears to be struggling to push forward its reforms. The President's project to increase government spending, through a massive investment plan to renovate infrastructure, coupled with lower revenues, corporate tax cuts and a reduction in the maximum income tax bracket, may not deliver the promises of growth revitalisation made by the candidate. Firstly, he will likely come up against the resistance of traditional Republicans in Congress who could refuse to support a fiscal stimulus program, synonymous with a drastic increase in the national deficit. According to the Committee for a Responsible Federal Budget (CRFB), the tax reform proposed by the Trump administration would represent a revenue loss for the US Treasury of nearly 20% of GDP over 10 years. The timing of the fiscal stimulus is also far from ideal, since the US central bank (Fed), concerned about the return of inflation, entered a phase of gradual rise of its key rate. Two further increases are expected in 2017 after those carried out in December 2016 and March 2017. Indeed, the Federal Reserve (Fed), concerned about a return to inflation, is expected to implement further tax rate hikes in 2017 after those made in December 2015 and 2016. Also, the effects of President Trump's expansionary fiscal policy would be partially levelled by the tightening of monetary policy. The Federal Reserve policy could have an impact on the cost of loans, especially for the most modest households, and weigh on private consumption. The latter, which accounts for nearly 70% of GDP and is supported by the dynamism of labour market, would continue to support the economy. Nevertheless, with unemployment under 5%, any change thereto in 2017 will be contingent on an upturn in the employment rate (62.9 %), still below the pre-crisis level (66% on average between 2003 and 2007) and, above all, to the change in wages.

With a slowdown in consumption, the textile, transport and distribution sectors could suffer. The energy and mining sectors, hampered by low commodity prices, would remain under threat, despite the use of cheaper technology in shale oil production and improved efficiency and productivity in the fields exploited. Many companies are nevertheless heavily indebted and the expected rise in interest rates in the coming months will not be in their favor.

On the other hand, the increase in subprime student loans, as in the case of car loans, is always carefully monitored. The same is true for business bankruptcies, despite a slight decline in the first quarter of 2017.


A risky budget unlikely to reduce the country's debt

The government deficit is expected to increase during 2017, while the public debt remains on a worrying trajectory. The Trump administration's budget proposal based mainly on corporate and income tax reductions would certainly lead to a significant increase in the deficit, despite the expected additional growth that it would result. According to the White House, the virtuous circle induced by the lower taxes would contribute to a reduction of 2 billion USD of the public deficit over 10 years. However, the key piece of the budget remains the reduction of health, food aid and disability spending, as well as various other transfer programs, with cuts expected to generate savings of USD 3.5 billion over the decade. These reductions, however, are likely to prove very unpopular especially among the working classes. Moreover, the increase in income through a border adjustment tax remains a controversial subject, which has not yet been addressed. The hostility of a part of the Republicans in Congress should allow nuancing the ambitions of the American president, but would not alleviate the upward trend of the American public debt.


Mr Trump or two narratives of the current account balance

One of the key features of Mr Trump's plan is his desire for increased protectionism, as evidenced by the abandonment of the Trans-Pacific Partnership (TPP). The American protectionism is hampered by the unescapable trade deficit. Indeed, the weakness of the national savings in the United States (about 3% of the national income) compels the country to import foreign savings. The inflow, used for purchases of foreign products, used to buy foreign goods, contributes to the deficit of the trade and current account balances. Moreover, financing additional budgetary deficit generated by the President's program would require more foreign savings that would, in turn, increase external deficits.

Additionally, the upward pressure on the dollar, exacerbated by the monetary tightening by the Federal Reserve, could also have an impact on the current account deficit. Its strength increases the cost of American products, especially manufactured goods for convalescent partner economies. This will weigh on export growth and will favour imports carried, furthermore, by the momentum of consumption.


Last update : June 2017


Exporters should pay close attention to sales contract clauses on the respective obligations of the parties and determine payment terms best suited to the context, particularly where credit payment obligations are involved.

In that regard, cheques and bills of exchange are very basic payment devices that do not allow creditors to bring actions for recovery in respect of “exchange law” (droit cambiaire) as is possible in other signatory countries of the 1930 and 1931 Geneva Conventions on uniform legal treatment of bills of exchange and cheques.


Cheques are widely used but, as they are not required to be covered at their issue, offer limited guarantees. Account holders may stop payment on a cheque by submitting a written request to the bank within 14 days of the cheque's issue. Moreover, in the event of default, payees must still provide proof of claim.


“Certified checks” offer greater security to suppliers since the bank certifying the cheque thereby confirms the presence of sufficient funds in the account and makes a commitment to pay it.


Although more difficult to obtain and therefore less commonplace, “cashiers checks”, cheques drawn directly on a bank's own account, provide complete security as they constitute a direct undertaking to pay from the bank.


Bills of exchange and promissory notes are less commonly used and offer no specific proof of debt.


The open account system is only justified after a continuing business relationship has been established.


Transfers are used frequently especially via the SWIFT electronic network – operated by the Society for Worldwide Interbank Financial Telecommunication – to which most American banks are connected and which provides speedy and low-cost processing of international payments.

SWIFT transfers are particularly suitable where real trust exists between the contracting parties since the seller is dependent on the buyer acting in good faith and effectively initiating the transfer order.


For large amounts, major American companies also use two other highly automated interbank transfer systems – the Clearing House Interbank Payments System (CHIPS), operated by private financial institutions and the Fedwire Funds Service System, operated by the Federal Reserve.


Debt collection


American law is inspired by the « common law » system, an Anglo-Saxon inheritance, based on doctrine, custom and case-law.


Since the American legal system is complex and, especially as regards lawyers’ fees, costly, it is advisable to negotiate and settle out of court with customers wherever possible or else hire a collection agency.


The parties can also resort to arbitration or Alternative Dispute Resolution (ADR), a relatively informal mediation method, which makes it possible to avoid costly and lengthy ordinary court procedures.


The judicial system comprises two basic types of court: the federal District Courts with at least one such court in each State and the Circuit or County Courts under the jurisdiction of each State.


TheFederal Rules of Civil Procedurepromulgated by the Supreme Courton September 1938 and regularly amended govern the various phases of civil procedure at the federal level while each Statehas its own rules of civil procedure.


The vast majority of proceedings are heard by State courts, which apply state and federal law to disputes falling within their jurisdictions (i.e. legal actions concerning persons domiciled or resident in the State).


Federal courts, on the other hand, rule on disputes involving State governments, cases involving interpretations of the constitution or federal treaties and claims above 75,000 US$ between citizens of different American States or between an American citizen and a foreign national or foreign State body or, in some cases, between plaintiffs and defendants from foreign countries.


A key feature of the American judicial system is the pre-trial "discovery" phase whereby each party, before the main hearing, may demand evidence and testimonies relating to the dispute from the adversary before the court hears the case. During the trial itself, judges give plaintiffs and their lawyers a considerable leeway to produce pertinent documents at any time and conduct the trial in general.

This is an adversarial procedure, where the judge has more the role of an arbitrator, ensuring compliance with the procedural rules, although more and more practice enhances the part of the judge in the running of the case.


An amendment to the Federal Rules of Civil Procedure, in force since 1st December 2006, authorizes document submissions in electronic form (e-discovery) like e-mail, real time computer communications, accounting databases, Internet sites, and so on.


The “discovery phase”can last several months, even years, and entail high costs due to each adversary’s insistence on constantly providing pertinent evidence (argued by each party), and involve various means – like examinations, requests to provide supporting documents, the testimony of witnesses, and reports by detectives – before submitting them for court approval during the final phase of the proceedings.


Another feature of the American procedural system is that litigants may request a civil or criminal case to be heard by a jury (usually made up of twelve ordinary citizens not familiar with legal aspects – “twelve goodmen and true”according to the popular definition of “jury”) whose task is to deliver a verdict based overall on the facts of the case and the evidence produced during the proceedings.


In civil cases, the jury determines whether the demand is justified and also determines the penalty to impose on the offender. In criminal cases, the jury decides on the defendant’s guilt but the judge decides the punishment.


For especially complex, lengthy or expensive litigation, as in the case of insolvency actions, courts have been known to allow creditors to hold as liable the professionals (e.g. auditors) who have counselled the defaulting party, where such advisors have demonstrably acted improperly.

Insolvency trend United States of America 2015
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