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Sunday, January 29, 2023

Are SMEs going extinct in Argentina?

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In South America, Argentina has the lowest business birth rate, and compounding this situation, the business death rate is the highest in the region. Without going further, small and medium-sized companies have sunk 3% in recent years and it has been proven that only 1 in 10 survives the first five years from its creation.

Companies with fewer than 50 employees are being hit hard. The loss of competitiveness is very great and the lack of financial education and tactics and strategies related to entrepreneurship are increasingly distant or non-existent within this important sector

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In a country where, with more than 47,300,000 inhabitants, there are 467,000 small and medium-sized companies registered, the number is low and speaks ill of our level as creators of brands, of our lack of entrepreneurship as Argentines and of our weak or non-existent financial education which should be, by the way, taught from schools,

Clearly inflation, the lack of techniques and strategies to empower citizens, not with social plans but with tools that help them create a finished product and export channels, clearly influence this declining socioeconomic, even cultural situation.

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Another of the influencing factors is the lack of qualified personnel, and I mean people with arts and crafts who have some experience. There is also a 31% reduction in formal employment in this business sector.

Let’s remember that the generator of high-quality work is companies, not politics.

Apart from the lack of financial education, tactics and techniques on the part of the government to promote and create entrepreneurs, as well as insufficient policies to support exports that Argentina has, we also see that we are in a country where Banks can only lend to those who can demonstrate that they do not need it and that contributes to the discouragement and unease of those who want to start a business and need initial capital at a low rate and over a long term.

Clearly the condition goes directly to the macroeconomy, and having fewer companies also impacts inflation since there are no competitive alternatives between products and services

If we want to become a world power again, and we have the tools like the countryside, Vaca Muerta and lithium to start talking, we have to understand that the path is entrepreneurship. Promote the most valuable asset that the Argentine Republic has that its own people. Politics must be present especially in the transformation of social plans to entrepreneurial ones, and I say well: social plans, not workers in a dependency relationship. Directly to Entrepreneurs, since the level of motivation that a person must have to leave lethargy and dependency on the social plan must be first of all in the Motivation to win and it is not fear of losing

Specialist in Financial Education and Entrepreneurship

Source: Ambito

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