exporters' associations proposals
The fall in the dollar value of various sectors of concern to exporters, particularly those that sell some varieties of fruit and that in recent years have operated with low margins. That is understandable, but if the observed dollar is trading at a reduced rate compared to previous years, some economists argue that the alarm must be maximized, since the real exchange rate is now only six percent less than its average in the period 2001-2010. The risk of doing something drastic is that it can cause major distortions in our economy, affecting their performance. It is therefore necessary to evaluate very carefully the proposals that are formulated to increase its value. Recently, fifty trade associations and workers associated with the agricultural export sector and have submitted a document containing a series of initiatives to address the fall exchange rate and raise the competitiveness of the country and its industry.
The fall in the dollar value of various sectors of concern to exporters, particularly those that sell some varieties of fruit and that in recent years have operated with low margins. That is understandable, but if the observed dollar is trading at a reduced rate compared to previous years, some economists argue that the alarm must be maximized, since the real exchange rate is now only six percent less than its average in the period 2001-2010. The risk of doing something drastic is that it can cause major distortions in our economy, affecting performance. It is therefore necessary to evaluate very carefully the proposals that are formulated to increase its value. Recently, fifty trade associations and workers associated with the agricultural export sector and have submitted a document containing a series of initiatives to address the fall in the exchange rate and raise the competitiveness of the country and its industry.
There are some interesting proposals in that document, among which include the idea of \u200b\u200braising coverage caps guarantee funds for small business and manages investment Corfo. The latter institution has perfected these instruments, which may in some cases, be a support for conversion. In the latter regard, this paper proposes a national program, but the internal and external comparative experience of these attempts have proven to be ineffective.
It also suggest changes that seem relevant to the functioning of public services and technical assistance initiatives for small and medium agricultural enterprises. They exist today, but should be reformulated to produce a greater effect.
However, the emphasis of the paper is on suggestions unrealistic and unproductive to sustain a higher level exchange rate. For example, it is postulated that the conversion of dollars to exporters is an exchange rate of long-term balance of 550 pesos, but this figure is an artificial construction, which would represent a significant cost to the Central Bank and the Treasury.
It also proposes to define a long-term price of copper also artificially low, so that according to the structural balance rule, the State, in fact, save in excess. But socially, those savings would not be efficient.
The way to increase the competitiveness of the country demands increased productivity, and no artificial solutions to maintain high exchange rate. To achieve this goal requires an economy more flexible to enable efficiency gains and higher levels of innovation.
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Rodrigo González Fernández
Diploma in Corporate Social Responsibility "UN
Diploma in Knowledge Management" UN
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