Basque exports remain one of the few saving graces of an otherwise bruised economy. Thanks to the early and continued commitment to foreign trade on part of the private sector, Euskadi is today an open economy. In 2012, Basque exports amounted to over €20 billion, equivalent to 31% of the GDP. In terms of exports, all indicators point to 2013 being a record year, making the Basque Region one of the leading European regions.
There are, however, some foreign trade statistics which raise some questions about this apparently rosy picture. Our success with exports is in no small measure due to our industrialised economy, so much so, in fact, that if we viewed our exports solely within the context of our economic model, we would actually fall below the European exporting average. Foreign sales continue to be highly concentrated in a few neighbouring countries, with UE15 countries making up for 56% of all Basque exports in 2012, compared to 10% to NAFTA, and a mere 6% to BRIC countries. Broken down sector by sector, 80% of the exports are in the key sectors of capital goods, semi-manufacturing and automotive, all under enormous pressure by low-cost competitors. Translated into specific numbers, we find that in Euskadi there were 2,700 regular exporters in 2012, or 2% of all Basque companies; nevertheless, fewer than 500 of those actually contribute to 90% of annual exports.
Here at B+I Strategy, we take another view of this seemingly contradictory data: we interpret it as a sign of both strength and opportunity. Euskadi has been, and continues to be, an exporting country which now has over 150 multi-located companies worldwide. Over the last 30 years we have created a sizeable public-private network of advanced services to support internationalisation, and we continue to train highly qualified professionals in foreign trade. These are solid assets which can help grow our exporting base, to increase existing international sales, as well as to diversify markets and strengthen the business models of our mini-multinationals. Success won’t be easy, though it is necessary.
There are many ways of dealing with a new wave of business internationalisation. We are focusing on those methods which are centred around co-operation since that is what has successfully brought us thus far, allowing us to share the huge challenge which internationalisation brings. There are many opportunities in internationalisation, so let’s capitalise on them.
*Published in Estrategia Empresarial (16-28 February, 2014)