THE ARGENTINA’s 2019 AGENDA OF INTERNATIONAL TRADE Understanding cultural diversity as a relevant issue in today’s world
Categoría: Alemania

Félix Peña (*)

December 2018

 

 

 

Abstract:

 

Argentina’s role as a G20 member country will go on after the Buenos Aires Summit. In the shortest term as part of the troika, along with Japan and Saudi Arabia, during 2019. As such it can contribute with its recent experience in managing the dialogue process and building the necessary consensus. Secondly, as could be seen in the development of the 2018 G20, the country can play an effective role in the dialogues aimed at building consensus on the relevant issues of the global agenda. Thirdly, due to the fact that it is convenient for our country and our region to participate in the construction of a new global governance, adjusted to the current realities of a world in which all the protagonists –not just the largest–have multiple options in their strategies for international insertion.

 

Several new issues stand out in the 2019 agenda of priorities for Argentine foreign trade. They are related with the need to update the strategies for the projection to the world of the goods and services of quality that the country is able to produce efficiently, based on competitive advantages and, in particular, on the endowment of natural resources, talent and creativity, and the diversity of its industrial and technological development.

 

This renewal becomes necessary in view of the changes that have been taking place recently at global scale and in the Latin American regional environment. Moreover, these changes make the interaction between the different cultures that characterize countries and regions and, therefore, international trade, more intense. Understanding the scope and effect of cultural diversity, with its impact on the priorities and preferences of citizens and consumers, is increasingly becoming a crucial factor in ensuring the international competitiveness of a country and its companies.

 

The main issues to be included in the 2019 agenda of Argentine foreign trade are: globally, to understand and to influence the necessary renewal of the multilateral system of world trade, institutionalized in the WTO and, at the same time, to achieve the country’s linkage with the growing network of preferential trade agreements of regional and inter-regional scope; at the Latin American level, to have an active participation in the adaptation of Mercosur to the new realities of world trade, including the necessary articulation between its member countries and those of the Pacific Alliance, and fully harnessing the potential of 1980 Montevideo Treaty (LAIA), and at the national level, to achieve an effective development of the strategy included in the “Argentina Exports” program, launched last October by the national government through the Ministry of Production.

 

 

At the conclusion of the G20 Summit in Buenos Aires, the process that will lead to the 2019 Summit has begun. Japan took over the Presidency of the G20 and, with it, the task of ensuring that the dialogue among the participating countries helps build effective consensus in relation to the relevant and interconnected global issues that have a strong economic, social and, thus, political impact.

 

These issues go beyond what individual countries –even the most powerful ones– could tackle on their own or solve with realistic expectations of success and, if kept unresolved, could affect them sooner or later. They show that in today’s world countries and their citizens are increasingly interconnected and exposed to situations that transcend their national borders. The G20, at the level of Heads of State, arose precisely at a time when the strong financial crisis could not be addressed through the existing international organizations. It was necessary to create a forum of dialogue geared towards the action of the top political leaders of a group of countries that were supposed could add more capacity to agree upon the required actions at global scale.

 

As demonstrated by the successive summits held since the G20 was elevated to the level of a global forum of leaders, ten years ago, both dialogue and consensus-building are arduous endeavors. There are many participants and their interests and perspectives can often differ greatly. Therefore, conducting the dialogue requires direct and committed participation of the Head of State of the country that holds the annual presidency. Being a process that takes place over several months and with multiple meetings, many of them at Ministerial level and with the active participation of different expressions of social life, effective teamwork is required, and the figure of the “Sherpa” becomes crucial.

 

Argentina’s role as a G20 member country continues after the Buenos Aires Summit. In the very short term as part of the troika during 2019, along with Japan and Saudi Arabia. As such, it can contribute its recent and valuable experience in managing the dialogue process and, in many cases, building the necessary consensus, in the same way as it was able to take advantage of the experiences gained by China and Germany in their own presidential periods.

 

Secondly, as could be seen in the development of the G20 this year, the country can have an effective role in the dialogue aimed at building consensus on relevant issues of the global agenda. This may be so precisely because our country has neither the power nor the economic dimension to aspire to become an undisputed leader at global scale. Argentina is part of a group of significant countries when it comes to building global consensus, precisely because it has a medium level of power and some capacity to influence certain sectors (for example, food) or regions (for example, South America, the South Atlantic and Antarctica) that are relevant at global level. Additionally, it is a country that is relatively far from the main lines of international tension and that, in keeping with its values ​​and preferences, has no reason for not getting along with all the countries of the world. Likewise, as a country and as a region characterized by the diversity of origin of its population, it has the capacity to understand a world where a dominant feature is, and will continue to be, cultural plurality.

 

Thirdly, it is in the interest of Argentina and the Latin American region, to participate in the construction of a new global governance adjusted to the current realities of a world in which all the protagonists –not just the largest–, have multiple options in their strategies for international insertion and know that they can exercise them, even in the dialogue with the great and powerful.

 

What is also increasingly clear is that to navigate as a country in a world of multiple protagonists and multiple options, at least three conditions are required. The first is to have a strategy of insertion in the world, with a long- and short-term vision, sustained in the social bases of the country. The second is to achieve an effective regional insertion that takes into account the need to build an institutional architecture that facilitates convergence in diversity. And the third is to craft work and trust relations with the other regions of the world and, in particular, with all the great powers.

 

In the perspective outlined in the previous paragraphs, several novel issues can be highlighted from the 2019 agenda of priorities for Argentine foreign trade. These have to do with the need to update and renew the strategies for projection to the world of the quality goods and services that the country is able to produce efficiently, based on its competitive advantages, the endowment of natural resources, talents and creativity, and the diversity of its industrial and technological development.

 

It is a necessary renewal on account of the changes that have been taking place in recent times at global level and in the Latin American regional environment. These are the expression of an era characterized by the presence of a great number of diverse players –countries, companies, consumers, social organizations– in the competition for world markets, with multiple options for buying and selling goods and services they need, prefer and value. They reflect the fact that the distribution of relative economic and technological power allows us to consider an increasingly large number of potential competitors with a very diverse geographical distribution.

 

Moreover, these changes make the interaction between the different cultures of each country and region and, therefore, international trade more intense. Understanding the scope and effect of cultural diversity, with its impact on the priorities and preferences of citizens and consumers, is increasingly becoming a crucial factor for ensuring the international competitiveness of a country and its companies.

 

We are entering a stage of world trade in which the protagonists are increasing in number and tend to be more connected. Therefore, it would be difficult to hold the idea that there are just a handful of players with a major influence on the definition of priorities and, above all, of the rules of global competition. In practice, unless hindered by security restrictions, countries will increasingly seek to have good relations with every other country.

 

The main issues to be included in the 2019 agenda of Argentine international trade are the following:

 

  • At global level, to understand and influence the necessary renewal of the multilateral system of world trade, institutionalized in the WTO and, at the same time, achieve the effective linkage of the country with the growing network of preferential trade agreements of regional and inter-regional scope;

 

  • at the Latin American regional level, to have an active participation in the adaptation of Mercosur to the new realities of world trade, including the necessary articulation between its member countries and those of the Pacific Alliance, and the utilization of the full potential of the Treaty of Montevideo of 1980 (ALADI), and

 

  • at the national level, to achieve an effective development of the strategy included in the “Argentina Exports” program, launched last October by the national government through the Ministry of Production.

 

It is obvious that these are not the only priority issues of Argentine international trade for the year 2019. Other issues will result from the policies of macroeconomic stability and their ensuing effect on the stability of the political system, which develop in the upcoming months and, especially, those that seek to achieve clear gains in productivity, technological innovation and social articulation, without which it would be difficult to imagine a successful international insertion of the country.

 

At the global level, reforms to the WTO are a priority. It is a key institutional framework for preserving basic rules of international trade, such as the principle of non-discrimination in tariff policies and other business practices. The G20 meeting in Buenos Aires has agreed to seek the necessary consensus and review the issue again at the next Summit in Japan. Argentina, as a member of the G20 troika, will be able to continue developing a facilitating role in the construction of such consensus, as it did in the recent summit.

 

At the Latin American regional level, the reform and updating of Mercosur, as well as its articulation with the Pacific Alliance, will also have a high priority. Everything indicates that, due to political reasons, it would be most convenient to achieve this goal without the need to reform the Treaty of Asunción, which could pose internal difficulties in some of the member countries. This is feasible if practical and non-dogmatic approaches prevail, especially on what should be a customs union, or a free trade area. The combination of political sense, economic pragmatism and legal flexibility would help achieve concrete results while ensuring the necessary predictability of the rules that are agreed upon. At the Latin American regional level, the Treaty of Montevideo of 1980 (LAIA) provides, with the figure of “partial scope agreements”, the necessary instruments for the development of an intelligent and pragmatic strategy of productive articulations of sectoral scope.

 

Finally, at the national level, an effective development of the “Argentina Exports” program would not only help get closer to the objective of having approximately 40,000 exporting companies with a sustained presence in other markets by the year 2030, but, above all, it would strengthen the federal scope of the strategy of international commercial insertion of Argentina, with its resulting impact on the political system of the country.

 

The successful experience of the role played by Argentina in the G20 Summit and throughout the process of meetings held over the twelve-month period preceding it, leads us to value teamwork when it comes to achieving difficult objectives at the international level.

This is the case of the three issues of the 2019 agenda mentioned above. As shown by Argentina’s participation in the G20, the direct commitment of the President and his presidential team would be essential, as would the figure of a Sherpa to address every issue. Therefore, assuming that President Macri will have the necessary personal commitment for achieving the previously mentioned goals of the 2019 agenda, it would be a good idea to consider having a Sherpa in charge of monitoring each of these relevant issues.

 

 

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(*) Director of the Institute for International Trade of the ICBC Foundation; Director of the Master Degree in International Trade Relations at Tres de Febrero National University (UNTREF). Member of the Executive Committee of the Argentine Council for International Relations, (CARI). Member of the Evian Group Brains Trust.

 

 

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