March 4, 2021

More integration, a need for entrepreneurs of the Pacific Alliance



Integrate regulatory and financial processes and avoid becoming "enemies of yourselves" are the issues and concerns that will be discussed starting on Thursday at the Business Summit of the Pacific Alliance, prelude and main attraction of the Summit of Presidents of the association.

The event will bring together for two days in Lima 500 of the most representative and influential entrepreneurs in the region and will address issues such as competitiveness, innovation, the institutional and political future and environmental management within the Alliance, from the point from the perspective of the business, a "nurtured" and "interesting" agenda.

This is how Alfonso Bustamante, president of the Foreign Trade Company of Peru (COMEX) and organizer of the meeting, expresses in an interview with Efe the aspirations of the business associations, their fears and their hopes in a commercial block that increasingly is a "need" for its members.

– Question: What is coming with this meeting in Lima?

– Answer: The Business Summit of the Pacific Alliance will be very interesting because it brings a full agenda. We will make a discussion and introspection about what we have advanced, questioning what all this is for.

(…)

It really is a very interesting program, very strong, very powerful and that is also counting on the confirmation of around 500 businessmen. We have been busy making invitations to all economies and come the heads of economic groups of the four countries, many bosses or owners of transnational companies.

(Attendees) We are not only interested in integration to trade and transport within the Alliance. This has more ambitious objectives, which are basically that, as an economic block that would represent the seventh largest economy in the world, it can also be prepared to trade as a block with the rest of the world. That is the true value of the Alliance.

– Q: How would you order these claims in importance?

– A: Free trade is very important, but all of us already have treaties between us and that is why we have to see how to trade with the world. For that, in reality, we need greater integration between, for example, regulatory bodies.

Free economies, like the four that we have here, where the private sector has been entrusted with being the generator of value, we have the counterpart of the State as administrator. It has an important role in promoting investments and then being an efficient regulator.

We have many deficiencies among the four of us, with uneven regulation, and we have to harmonize it in order to become a block.

Private entrepreneurs also see that financial integration is fundamental, the double taxation agreements that exist between us are too tied up. It's about second-generation reforms that we need.

In order to invest in other countries and take advantage of the savings of the pension funds of each one, we must really have a unified market. (…) Investors prefer to invest in their own stock exchanges, but through a truly integrated market, that would give us the necessary depth to bring funds that do not look at us now because we are small.

(…) Double taxation, now there is no simplified process, when it should be automatic. If I pay a tax in Colombia as a Peruvian company, that tax must be automatically recognized by the Peruvian national tax authority, it is the only way to achieve an integration.

Q: Is it really necessary in today's world, to work in blocks?

A: It is easier to work in blocks for smaller economies. To think that Peru, Colombia or Chile alone can be an attractive proposal to trade with other blocks or with very large economies whom we believe to attract here, is deluded.

Present a block economy, being aware of the sizes that we have, that has done the work of regulatory harmonization, of control, of markets, which is an economy that already represents the seventh position in the global ranking, is already different.

Beyond this, the world has blocks and we aspire to be part of winning blocks.

Q: The meeting took place as soon as the agreement between the European Union and Mercosur was known. Is something similar an aspiration that you would like to achieve?

A: Of course, it is a great aspiration, we see it very well. It is a great sign because Mercosur was more closed and less permeable to opening up to the markets. They have had protectionist cuts and, now, this is great news.

The good sign is that economic and commercial integration is on the agenda, and that is what we have. We greatly welcome an initiative like this because, in the same way, the Pacific Alliance aspires to integrate with the world.

Q: And what threats do you notice, or what latent problems are there in this way? The conflicts between China and the US?

A: Precisely, what the Alliance proposes is integration with the world, independent of the US and China. Equally, with respect to (Donald) Trump, he looks a lot at the deficit in the trade balance, and that is what happens to him, or at least one of the things that happens to him with China.

I do not know if by chance or fortunately the US is surplus to us, we are not therefore a natural commercial enemy, on the contrary we are quite complementary.

Q: And would political integration be an aspiration?

A: That's not on the agenda.

Q: And the internal politics, can disturb the relations within the bloc?

A: The greatest difficulties and threats have not come from outside but from ourselves, there are policy changes in our economies and countries and new administrations that are not as enthusiastic as the previous ones in the Pacific Alliance.

In fact, we have, and I am referring mainly to Mexico, moderate expectations of integration, for example, with the reception of the associated economies.

They tell us to finish our topics before welcoming others. We have delayed with that. Colombia has also preferred to look internally for now.

We are in revisions of something for the political part, but the advantage of the Pacific Alliance is that it has a private council and receives the "input" from the businessmen, who are the actors finally of that economic integration that we are going to have.

Q: Would a dream be to expand the format?

A: Of course, those of us who believe in integration use the blocks as a bridge for total integration, here we dream of free and barrier-free economies because markets finally expand, protectionism is lowered and value is assigned to the efficient and capacity, and that generates more investment and development.

And we aspire to a greater welfare of the citizens of each of the economies. The vehicle that we believe is the only one to improve everything is investments, and there are more investments when you expand markets.

We can not live by looking at ourselves and trying to sell us few goods and services, but aspiring to the world. The blocks are only a stairway to a total opening.

Álvaro Mellizo

(tagsToTranslate) integracionuna (t) need (t) entrepreneurs (t) Alliance (t) Pacifico



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