Crucial reforms

Photo : D.R.

Recently elected, Ambrosio Bertolotti is President of AICO between 2008 and 2010. At the age of 60, he manages a family business created in 1894. He is also President of the SME Commission of the Chamber of Commerce in his homeland Uruguay.

Commerce International: How was the idea of an association of Latin-American Chambers born?
Ambrosio Bertolotti: “It was born from the desire of Ibero-American company heads to be duly represented in the international community. It was in November 1974, in the city of Mexico that the first meeting between Chambers and trade associations took place. A second meeting, organised in Madrid in 1975, allowed the constitution of AICO to be finalised. The association is composed of an assembly which meets at least once per year, a steering committee and an office that is the permanent management organ. AICO assembles the Chamber heads and functions as a helpdesk for its members.”

Competitiveness seems to be a recurrent hobbyhorse in AICO assemblies. In this area, what does your association hope for from public powers?
A. B.: “AICO endeavours to promote free trade and expects public powers to facilitate private initiatives, for example by refraining from suffocating activity via excessive regulations and fiscal policies. We follow indicators of international competitiveness very closely, in order to ascertain what still needs improvement in each country. In this way, we believe that it is a real priority to carry out deep State reforms, notably in the numbers and quality of administrative staff. This would allow its management to be more efficient, reduce costs, and consequently, lower taxes. Moreover, it seems crucial to increase trade integration procedures and the free functioning of markets. AICO is currently carrying out a survey in the Ibero-American region on current situations and expectations, notably in the area of competitiveness. Finally, our association has participated in a correspondence course programme relayed by the network’s different Chamber members. This programme aims at training entrepreneurs to become more competitive.”

You have mentioned the necessity to pursue economic integration in the region. Where is the procedure at?
A. B.: “Integration exists on the sub-regional level, but the region suffers from the absence of a clear-cut project for general integration. For the moment, we can count on different integration procedures, including those from Mercosur, Aladi (Latin-American Integration Association), Caricom (Carribean Community) or Unasur (Union of South American Nations). These have carried out remarkable efforts; of course, there is still progress to be made. But a genuine desire reigns towards this end and the economic crisis affecting the whole world may well be an important motive for perfecting these integration mechanisms. AICO is encouraging the signature of free trade treaties between the countries in the region. Unfortunately, certain countries have preferred to hold back and this, at times, in spite of their neighbours’ expectations.”

Trans-Pacific integration and notably free trade treaties signed with China are sometimes subject to con-troversy. How do you perceive this growing economic integration?
A. B.:“Rather than a challenge or a threat, the rapprochement with China is a reality that has not ceased to increase and is getting stronger day by day. Our countries, in particular those located on the Pacific coast, see China as an increasingly important supplier and as a sometimes implacable rival. However, it is also a market that offers enormous prospects. All therefore depends on the prism through which we choose to observe the situation. I personally think that we should approach relationships with China optimistically, given that such relationships represent for our country an extra reason for improving competitiveness on the world market. We are here speaking about fair international trade free from economic or social dumping.”

According to you, does this situation have a negative impact on the traditional partnership maintained with the Iberian Peninsula?
A. B.: “I don’t see why exchange with China should be detrimental to the links we maintain with the Iberian Peninsula, as they are complementary partnerships. Spain has invested heavily in the domains of communications and energy and the products we export from her are excellent in quality. China mainly supplies us with consumer goods.”

How have Ibero-American economies been affected by the economic crisis, notably in credit granted to SMEs?
A. B.: “During the last meeting of the AICO bureau, Chambers expressed their concern about the crisis that has already settled in our economies. In many cases, the crisis has laid bare pre-existing problems: excessive government spending, over-abundance of credit granted to householders, speculations on exchange rates, protectionist trade policies. This crisis has set off a “flight towards quality” on the part of investors; the consequence is an impact on credit, in the area of investments as well as working capital – vital for SMEs – as well as for household consumption.”

In the face of the extent of the economic crisis, how do you envisage the year 2009 and what are your expectations with regard to international organisations?
A. B.: “Situations differ according to the country. Some have a financial system “safeguarded” from potential capital fragility and investor panic. This is for example the case of Uruguay where I come from. Authorities have, in a certain manner, anticipated the current crisis, which allows us to not panic too much for 2009. Others, on the contrary, have a more vulnerable system, compounded by a delicate public finance situation. In this case, re-negotiation with international organisations such as the WMF and the World Bank seems to be necessary.”

What do Ibero-American entrepreneurs expect from US trade policy following the election of Mr. Obama ?
A. B.: “I can only express my satisfaction regarding the manner in which Barack Obama is setting up his government. He has called on people of great intelligence and with wide experience of high responsibilities, which inspires broad confidence inside as well as outside the USA: Hilary Clinton, Lawrence Summers or Paul Volcker. The whole of his team bodes for a prosperous governance, which responds perfectly to the needs of the United States, in the midst of a delicate economic situation. As far as the trade policy of the next administration is concerned, it is preferable to wait for the next declarations on this subject. We must not forget that the announcements made during the electoral campaign should be adapted to domestic realities and those of the world. I think that it is in the interests of the United States to cultivate and strengthen their friendships with numerous countries. However, the best way to get there consists in developing trade and economic links, and Barack Obama should not lose sight of these.”

The Ibero-American Association of Chambers of Commerce (AICO) draws together over 60 Chambers from Latin America, the Carribean, the Iberian Peninsula and US Hispanic communities. President of AICO, Ambrosio Bertolotti displays level-headed optimism in the face of the great challenges of 2009.