Regional integration of SMEs, Aladi’s commitment to increase trade

The regional integration of small and medium-sized enterprises (SMEs) to put aside political speeches that “sometimes fail” and generate a digital platform in the continent is the bet of the Latin American Integration Association (Aladi) to strengthen trade in times of economic crisis.

This is how the general secretary of Aladi, the Uruguayan Sergio Abreu, says that the idea of ​​the organization is to generate a “social fabric”, in which companies from the 13 member countries can access information, training courses and network of contacts to improve regional trade.

“Today Aladi, its 13 countries, are barely trading 11% compared to 50 or 60% in Europe or almost 50% in Asia. It means, to put it very clearly, a failure of the integration project that needs more than political will ”, emphasizes Abreu.

Aladi launched the platform “SMEs, big businesses” aimed at micro, small and medium-sized companies that, according to the Secretary General, represent more than 90% of the productive structures of the region and in this pandemic they have lost some 40 million jobs of work that affected the “social fabric”, investment and social peace.

“The observation that we have is that most SMEs do not have the necessary vehicles to be able to connect and know in depth what their advantages are and their ability to export, import and link their value chains,” says Abreu, who argues that therefore this platform is necessary.

The objective is that, through a digital instrument, entrepreneurs can access “privileged information” about the region’s trade, regulations, trends, tariffs, among other things.

“This business community will also have additional instruments, financing and some aspects of connection and even delivery even with the Postal Union of the Americas, to give a digital expression to everything that trade means from the point of view of its ease “, he emphasizes.

Due to the asymmetry of Latin America, which means that there are countries with large markets -such as Argentina, Brazil or Mexico- and others that are small or with great difficulties, such as Bolivia, there is no standard on the consideration of SMEs, but rather the spectrum is extremely broad.

“The important thing is that trade is a reflection of integration and, if integration is not trade in the current records, at least it is a failure of an economic and social nature, which is what worries us the most,” he says. Abreu.

Despite the fact that today, about 85% of the trade of the countries of the region is free of tariffs, the lack of information or some regulations that generate restrictions means that trade still cannot develop as it should.

However, Aladi is committed to reaching 100,000 companies within this platform by 2022.

“When the entrepreneur has a difficulty and sees that he wants to improve or defend himself from a certain situation, he has to know this platform,” he points out and adds that the reception from entrepreneurs has been “very good.”

Financing, transport or customs are just some of the main challenges that this initiative must deal with to be successful, although Abreu assures that there are already several interested in supporting different aspects of this platform.

“The objective is to always be on the technological frontier, that we are not offering a bicycle with square wheels and that the businessman knows that he will also have his effort but this is free”, he highlights.

Although the focus is on the region’s internal trade, Abreu considers that it would be good to include extracontinental agreements in the value chain, but that is difficult since Europe has a “double political discourse”, he says, which does not allow the agreement between the Southern Common Market (Mercosur) and the European Union (EU), signed in 2019 but in the absence of ratification in each member country.

“The European Union is not sensitive enough to take into account that there is a Mercosur market of almost 300 million,” says Abreu, for whom Europe speaks “of Latin America as if it were an interlocutor,” which means “ignoring the obligations that Europe has with international trade and the governance of countries ”.