Non-EU exports the highlight of the Catalan export report
- Carles Murillo highlights geographic diversification as the best export strategy
The Department of Business and Employment of the Generalitat of Catalonia have published the most recent data, corresponding to November 2014 when sales outside of Catalonia grew by 4.4% year on year. This rate is higher than that of the Eurozone (0.1%) and of other countries such as France (1.2%) and Germany (1.4%).
These data back up those released by the Barcelona Chamber of Commerce. According to this body, between 2005 and 2013, exports grew from 30.3% of the GDP of Catalonia to 37.7% and the number of companies with overseas clients steadily increased to reach a peak of 15,915 in 2014. Carles Murillo, full professor of Applied Economics and director of the Master in International Business at UPF Barcelona School of Management sees the increase in exports to non-EU countries as the best news about these export figures.
While 64.3% of Catalan exports go to the EU, non-member states are gaining significance. These exports have grown by 9.4 precentage points (from 26.3% to 35.7%) in the period from 2000 to 2014. It is important that companies do not focus only on the closest countries or emerging economies but that they go further and seek out opportunities in countries that are yet to be explored. This provides not just a competitive advantage but also allows for diversification of dependency risks, according to Murillo.
Geographic diversification is the best export strategy. he claims. It is relatively easy to export to EU countries since there are no customs or bureaucratic boundaries, health regulations are the same, communication infrastructures are efficient and tastes are similar. However, the crisis means that EU countries are now “risky”. It may be for this reason that the Catalan Chamber of Commerce’s 2015 action plan addresses a total of 51 international initiatives, the majority of which are in Africa and the Near East.
For Murillo, this information is a reflection of the work done by Catalan public and private institutions as well as educational institutions. Internationalisation and exportation are key for companies. Any overseas venture entails risk so it is important to know the market well, analyse business opportunities in each country or continent, become familiar with the legal and fiscal environment, etc. Before launch it is important to prepare and seek advice because the failure rate for exporting companies is very high. Murillo recommends preparation and backing as essential for companies that want to break into exports in any sector.