May 3, 2023, 4:00 AM
May 3, 2023, 4:00 AM
For years Bolivia has been heard speaking in favor of the internal market as a gravitating factor for development, especially for investment and public spending that increase internal demand and produce a great economic movement, although at the cost of a fiscal deficit for ten years. Already, despite which, the growth rate of the Gross Domestic Product (GDP) has been declining.
In contrast, Non-Traditional Exports – ENT (products from the agricultural, agro-industrial, forestry, lumber, manufacturing and artisanal sectors) were made subsidiary and were even branded as an “overflow economy” as if the benefit were for a few , when the study Employment and Socio-Economic Perceptions in Bolivian Exporting Companies, Faced in 2006 by the INE, IBCE, Udape and Caneb, he realized that this was not the case.
The study showed that the contribution of the export sector to GDP was not only 25%, but also that remuneration in the NCD sector exceeded the national average, as well as the average salary in the private sector, with higher benefits.
The survey on NCDs at that time also revealed that the Agriculture, Livestock, Hunting and Forestry sector was the main generator of employment, followed by the Manufacturing Industry, with a high multiplier effect for the national economy, from of the income generated.
Finally, another revealing finding regarding the non-traditional export sector was that 17 years ago the number of beneficiaries of this activity in Bolivia amounted to 1,300,000 people, based on remuneration for direct and indirect jobs, a figure that would be important to update. with the next National Census.
In my humble opinion, those who deny the importance of exports are unaware of the enormous benefits that this activity can have not only for companies, but also for workers and the economy in general.
Let’s see some of the most obvious benefits of export activity, focusing, first, on the case of companies:
A larger market to supply: Compared to the size of any internal market, the possibilities of reaching other countries and millions of consumers with high purchasing power, there is no point of comparison.
Risk reduction in business: Exporting helps reduce dependence on the local market in terms of diversifying the source of income, as well as lowering political and economic risks.
Increased profitability: Production at scale and with state-of-the-art technology allows increasing sales volume, reducing average costs and increasing returns.
Improving competitiveness: Exporting is not easy, but it is possible, yes, it requires a quality product or service, at an affordable price and with timely presence, something that forces the company to excel in terms of the global market.
Now let’s see how exporting benefits workers: More and better jobs: Expanded production can generate more and better job opportunities in the dynamic field of exports.
Better labor conditions: The high quality standards and production standards required of exporters abroad can also mean better labor standards, higher wages, and safer jobs.
Self-Improvement: Continuous training and improvement can lead to additional gain through increased productivity and new skills.
Job stability: Having alternative external markets can lower the risk of layoffs, unlike when you depend only on the national market.
Finally, let’s see the benefits of exporting for a small economy like Bolivia:
Higher growth: Exporting high volumes of goods and services to expanded markets can allow for a higher rate of GDP expansion.
More foreign currency income: The capture of dollars does not occur by selling in the domestic market, rather, through exports, which can help to have a balanced balance of payments.
Greater competitiveness: Exporting requires the modernization and efficiency of companies to be able to compete, which entails improving the quality of goods and services supplied in their own country, for the benefit of all citizens.
Better technology and knowledge: The internationalization of companies allows them to interact with economic operators from advanced countries, which can help diversify the offer and innovation in their own country.
Less dependence: Thanks to external sales, dependence on a single market -the internal one- can be reduced and the high vulnerability that this implies can be reduced.
Capital attraction: Exports can attract foreign direct investment, improving their access to technology and specialized know-how.
Therefore, exporting is not good, it’s great! That is why those who want to progress further insist on exporting more and more – like China, an emblematic case, by the way.
