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Argentina has to be more efficient and export more, that is not right or left

Argentina has to be more efficient and export more, that is not right or left

Q.: In what position is Argentina today in front of the world?

Cecilia Todesca Bocco: Argentina and the region that we make up is subject to a series of major shocks: pandemic, war, and contractive monetary policy to counteract the inflation generated by these two events. In turn, it is a territory where the resources and capacities that the world demands today exist. So, once again, if we implement the necessary public policies, if we implement an industrial policy in the broad sense: scientific, technological and employment generation, the region and Argentina have some opportunities ahead in strategic sectors such as energy, mining and knowledge-based services. But they will not happen by miracle. They are a consequence of the public policies that we are able to take off.

Q.: Just this weekend Massa spoke of the need to generate consensus to take advantage of the potential of these sectors…

CTB: When it is intended to promote the development of such important sectors, which are going to have a favorable result for the balance of payments, legal frameworks and continuity are needed during different governments around those industrializing axes. Probably in the opposition they do not want to call it industrializing axes, but we can put it as the European Union says: strategic autonomy. If we have energy capacities, if we have mining capacities, if we have Science and Technology to apply to these sectors, if we have the most important hubs in the generation of knowledge-based services, what is needed is continuity so that those who invest today know that you are going to have the same conditions over time.

Q.: Is there a risk that if there is no consensus, this opportunity will be wasted?

CTB: There is always that risk, but what I believe is that the people who claim to lead the country should be able to see this agenda. It is a very visible agenda, it is clear and other countries see it in Argentina and in the region. It doesn’t seem so difficult for those leaders to take note. Now, it is not by the art of the holy spirit that this is going to happen. It is industrial policy and scientific technology. We can give it another name if you want. But all parts of the world discuss what is produced, where and who generates the innovations. We must work for those consensuses.

Q.: There are many debates about the degree of protection that the Argentine economy has: Do you think it is a point to debate?

CTB: There are always things to discuss about whether the protection is effective. What is it protected for? To develop, once you develop, you would have to have good products for domestic consumption and production for export. If the only thing that protection does is that you have higher internal prices because there is no international competition, there is a question about what we are doing. This is the difficulty of industrial policy. You have to see who you are protecting, why you are doing it and what results you are getting. For me it is not openness or non-opening. But I think Argentina has to be more efficient and export more. Talking about efficiency and promoting good national production is not from the left or the right. There must be a counterparty to each protection.

Q.: Are there sectors where there was no counterpart?

CTB: Throughout history we have seen the development and generation of capacities in almost all the sectors that were supported and it seems to me that the balance is positive. But there are also problems in sectors where you find prices that have no competition.

Q.: How important is the relationship with Brazil and the arrival of Lula?

CTB: Brazil is the main trading partner. Our economic cycle is quite tied to that of Brazil, if Brazil is doing well, Argentina is doing well. Argentine companies that begin to export do so in Mercosur, it is our platform. With the arrival of Lula to the Government, a new agenda opens. It is the great interlocutor of Argentina, it is a platform that will give an additional boost to the Argentine economy. If we manage to negotiate together, we will be much stronger.

Q.: Because of your role, you are constantly on trade missions: What is the biggest difficulty that companies encounter when investing in Argentina?

CTB: The macroeconomic environment that was produced by the balance of payments crisis, including the inflationary acceleration. To which the pandemic and the war were added later, plus our weakness in the external sector that means that when we grow rapidly we start to lack dollars and we need to start putting more regulations on the exchange market. These are complex issues for an investor. It’s not something you face in other countries. It is possible that here they have higher profits, highly skilled labor and that there are resources that are not available in other places, but it is also true that they have to deal with other difficulties. That the macroeconomic be ordered is important. Now, you don’t get out of a balance of payments crisis from one day to the next.

Q.: After the encouraging data from 20202, how do you think this year will be in terms of investments?

CTB: Last year growth was led by consumption and investment, but investment was what grew the most. Today, with the corrected figures, the investment rate gives us 21.5%, which is the third highest value since 1993. The policy in favor of employment and production was giving its results. They invest because there is demand, which is why the recovery of wages is important. The discussion of income is not only about a problem of social justice but it is a problem of demand. You need domestic demand to be sustained because that is the platform on which Argentine companies work, which later, in some cases, are also exporters. We have several projects in these strategic sectors that are already being disbursed and others that are going to arrive and there are many other sectors where we are going to have investments that we already know about and the challenge is to take advantage of each of these vectors to add value.

Q.: How is growth going to be sustained this year? Where will the dollars come from?

CTB: In 2023 we are going to grow less than last year because we still do not have enough dollars to grow at 7% or 8%. One point in favor is that we are going to have the results of the gas pipeline. Last year there were dollars, exports grew in prices and quantities, our projection for 2023 is the one in the budget, around US$104,000 million. We have to see what happens with the drought, how much is going to be lost in quantities, how much is going to be compensated by prices that is going to happen with all this, but then there is work that has to do with locating industrial and agro-industrial production. We have to bet a lot on manufactures of industrial origin, which grew 17.8% in value and 4.7% in quantities, that is very important and it is what we have to strengthen this year and increase the number of companies that export. There are programs focused on that and we are going to put a budget there, in the programs that we already have as Desafío Exportador. In this way, companies that do not export or that do export but have a new product are assigned a specialist in foreign trade and these fees are borne by the Public Sector. That person stands next to the company and begins to see how and where you can sell the product.

Source: Ambito

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