Internationalization strategies in Iberoamerica. The case of Portuguese trade
Joaquim Ramos Silva
The Portuguese trade strategy is an interesting analytical issue. Indeed, as a small economy and contrary to most other similar European countries, Portugal, in the post-war, was late and slowly integrated into the world economy. This was mainly due to the maintenance of an economic logic of empire that has only waned in the late 1960s; and, after a transitory period (1974-1985) where deep macroeconomic imbalances did not allowed a reversal of the trend to neglect the construction of an effective and large trade strategy, the EC membership in 1986 began to influence the substance and institutional framework in this key area for a country with its characteristics. This paper basically focuses on the evolution of Portuguese trade and internationalization strategies between 1996 and 2006.
After a brief overview of the trade strategy and its main stages in the post-war (I), we examine the main changes occurred in Portuguese foreign trade, particularly exports, since 1996 (II). The latter chapter is developed under several perspectives: a) the behavior of exports within the context of the balance of trade in goods and services; b) the overall balance of payments with its flows, giving special emphasis to inward and outward FDI; c) the recent trends to geographical concentration or diversification of goods' exports; d) the analysis of the structure of exports of goods and services, by kind of products. The two following chapters deal with the institutional framework of Portuguese trade strategy. In chapter III, the public agencies with significant influence on the internationalization process are introduced: the PRIME/SIME and QREN programs supervised by the Ministry of Economy and Innovation; AICEP, by far, the most important public body in the field of external promotion (since July 2007, covering trade as well as investment); a shorter presentation of IAPMEI (specialized agency in the support to SMEs), and a view of the cooperation with the Ministry of Foreign Affairs complete the chapter. In chapter IV, the contribution of employers' federation and related organization to the Portuguese trade strategy is appraised, AIP and Forum para a Competitividade are examined in more detail; the role of COSEC, the main organization that manages the credit and finance for exports (including public funds), is also considered. In chapter V the Portuguese trade is put within the context of all Ibero-American countries, the bilateral relations with Spain and Brazil, those that have statistical significance are more developed, and deserve some comments. In chapter VI, we treat the export performance of Portuguese firms, and present a few experiences (Qimonda, Renova, Iberomoldes, and EFACEC). Finally, in chapter VII, we sum up the main conclusions of the previous analysis.
In a brief summary of the findings of this research, as far as the external sector is concerned and during the 1990s and 2000s, the Portuguese economy has not yet overcome important negative historical legacies like the fact of remaining relatively closed and showing deep competitive weaknesses. Until the middle of the 2000s, the performance of Portuguese trade was clearly unfavorable from the global and European point of view (one of most striking examples is the substantial reduction of Portugal's share in the German market). However, at the same time, there was an improvement in relevant aspects of the sector; e.g., the weight of new and upgraded products in the exports' structure has been enlarged and trade imbalances have diminished. After 2005, there are a few signs of a positive turn; we can observe a greater diversification of exports by products or geographically, in particular towards outside EU and new member states, and exports are growing at a higher rate than imports and output (in spite of the high value of the euro). One of the fundamental reasons behind the weak trade performance since the early nineties has clearly been the lack of a true and credible strategy of internationalization, particularly when addressed to solve competitive problems in the context of EMU. In this respect, also in the last years, more precise targets have been put forward and need to be seriously implemented. Even if these new initiatives are successful, due to the size and persistence of its fragilities, the competitive transformation of the Portuguese economy in the globalization era will be a long term process.
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