The recent opening of imports has generated mixed opinions among SME entrepreneurs. While some see it as an opportunity to access new products and technologies, others fear that it could harm the competitiveness of local companies in the short term. A new game that we have to play and of course, with new rules of the game.
The opening of imports is beneficial in the long term, as long as the necessary conditions are met so that Argentine SMEs can compete on equal terms with foreign companies. Let us keep in mind that a company that produces abroad has long-term credits to invest in working capital and new technologies, better labor laws, simple exchange policies (here we have 14 exchange rates!) and lower tax pressure, among many others. topics that make them more competitive.
We currently have deficiencies of all kinds and many of us trust that this will improve, but in addition to now competing with companies that have better conditions to produce abroad and bring their product to the country, we also have limitations to export; For example, the Argentine dried plum – just to give an example among thousands – pays tariffs of between 5 and 10% depending on the country that imports it, while the Chilean, which has the same product and is only one mountain range away, In between, they do not pay tariffs. Chile has 30 free trade agreements (FTAs) in force with 65 economies, representing 88% of world GDP while Argentina has 13 FTAs in force with 23 countries, representing around 50% of world GDP.
That is, due to tariffs alone, the sector must be 5 to 10% more competitive than the product of the neighboring country to equal them. Without taking into account the deficits in the country’s infrastructure, taxes, etc., etc., etc. which means that in many cases we must be 50% more competitive than other countries for it to be a business to produce and sell abroad. It is a titanic task.
How difficult to score a goal.
I believe that for the first time since the scourge of inflation began, there is consensus regarding the importance of lowering it and quickly, but opening imports without first improving all (or at least some) of these inefficiencies seriously harms Argentine SMEs that already They have been coming with a headwind for many years.
We no longer have a chance to score goals, we only save penalties.
We are in favor of free competition and opening imports, but under similar conditions for everyone. The current conditions punish those who bet on the country and reward those who went abroad and want to sell in Argentina.
There are 15 of them, there are 4 of us and 2 of us are injured.
In a country with immense structural inefficiencies like Argentina, where bureaucracy, corruption, instability and constant changes in the rules of the game can hinder progress, the creation of a good work team and the implementation of efficient processes become the key to success to survive first and grow later.
Achieving this allows us a counterattack, perhaps even scoring a goal.
SMEs do not seek subsidies or non-refundable loans, we seek to compete on equal terms with the rest. We are sure that if we had this support, the country’s takeoff would be rapid and of great impact.
Playing well depends on us but having clear, stable rules and ensuring that there are no teams benefiting from friendship, interests or apathy of the respective authorities.
CEO of Argensun Foods
Source: Ambito
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