Opinion Sur
For a transformational effort to materialize it is not enough to impose certain objectives but, also, it is necessary to eliminate inconsistencies between policies and measures; this will prevent unwanted effects on strategic variables that could compromise the chosen course. There are transformational efforts that throughout their implementation generate unwanted effects that could end up affecting the development of those who are meant to be favored. The fact is that when it comes to development the variables involved are many and interwoven, same as the effects caused by different intervention options are very diverse.
Every transformational action is after not one but a set of complementing objectives. Some outlined objectives can be antagonistic in essence but others may seem antagonistic without really being so. In these cases what usually happens is that traditional intervention modalities keep being implemented instead of innovative solutions adjusted in their effects to the transformational purpose. The will to transform does not transcend the objectives level and does not project itself on policies designed to implement such objectives. For a transformational effort to materialize it is not enough to impose certain objectives but, also, it is necessary to eliminate inconsistencies between the implementation of policies and measures; this will prevent unwanted effects on strategic variables that could compromise the chosen course.
This way, if goals of similar importance might seem antagonistic, instead of giving up on some to favor others, or subordinating some to others, it would be better to analyze the chosen intervention modalities and determine whether at that level there are other ways to intervene that do not affect other goals of similar importance. Usually there is more than one option to materialize a transformational objective, each one with different impacts on the rest of the variables that shape a good systemic march.
An example can help to illustrate the latter: the eventual inconsistency that may appear between the objective of equitable income distribution and social inclusion with the one of consolidating a solid export flow of goods and services.
Equity, inclusion and exports
The inconsistency could emerge while corroborating that exporters require scale and efficient management to compete in a globalized world. This fact privileges large economic actors that are capable of accessing those opportunities and leaves small and the greater part of medium scale producers behind. Large exporters tend to impose their higher negotiation power over suppliers and also over the State itself benefiting from policies, regulations, and infrastructure financing that, with the support of local partners, manage to get approved. Large exporters also have a diversity of mechanisms available to them in order to avoid paying taxes (under billing associated companies among others), through which they manage to circumvent their full tax responsibility. In this way they harm other taxpayers and the entire population by affecting the collection of public revenues [[See [Differentiating generation, redistribution and extraction of value->http://opinionsur.org.ar/Differentiating-generation?var_recherche=redistribution].]].
The extraction of value that large exporters exercise implies the appropriation of value they do not generate by themselves but thanks to the effort of the entire productive network participating in the value chain ending in export: this includes, among others, small and medium scale producers, distributors, the educational system that trains work force, the science and technology system that brings knowledge and innovation to the table, public works in productive infrastructure (energy, tracks, watering, ports and airports, transport, communications, flood control, etc.). That is why, when referring to appropriation of value not generated by exporters what is being stated is that they keep a revenue proportion that does not fairly contemplate the contribution public and other private actors made which enabled producing the goods and services that are exported.
Through these value extraction mechanisms they obtain extraordinary benefits that do nothing else but enlarge the reproduction of the wealth concentration process, with its effects on inequality that in our countries is expressed, in addition, in extended poverty. This concentration process [[A summary of its negative impacts is included in the article [Is the world burning?.->http://opinionsur.org.ar/Is-the-world-burning] Opinion Sur January 2013.]] is on the opposite end of equitable income distribution and social inclusion.
Usually, when a country is in need of external resources to finance imports and face debt commitments it might have contracted, the short-term strategy is to use the existing export channels and, therefore, the large actors that are currently in control of the export business. It is not simple to transform this situation and however, if the aim is really a higher degree of equitable income distribution and social inclusion, its reproduction over time is not an option. So, how can we act?
Other possible interventions
The starting point is recognizing, on one hand, that equitable income distribution and social inclusion do not only constitute an ethical imperative but also an essential dimension to ensure organic growth, social cohesion and democratic governability. On the other hand, the economic viability of a country that is part of a globalized world demands having genuine international resources, within which those generated by exports are quite significant. What is needed then is supporting the export flow with measures that contribute, at the same time, to improving equitable income distribution and social inclusion.
This can be accomplished in many ways acting simultaneously in several fronts. The following are some options that could be added to the traditional export promotion measures.
(i) Fair distribution of export revenues, which implies preserving the legitimate profit of every export activity and redistributing eventual extraordinary profits towards the entire value chain that produces the exported good or service. This means, facilitating the necessary backings to the exporter effort while ensuring results are fairly distributed among those who make it possible rather than ending up concentrated in the most powerful actors. The only actor that has the capacity to bring down this kind of economic concentration is the State, provided it has not been coopted or its policies conditioned by those who are benefited with the situation that is meant to be transformed. In fact, that is why this transformation front has an extremely critical political dimension that overlaps with the technical-economic one.
(ii) Promoting the emergence of new exporters. With appropriate support it is possible to promote the strengthening or appearance of small and medium exporters aiming at market niches they can compete in: to achieve this it will be necessary to underpin their capital formation, management capacity and access to information, contacts and sales. But is it also valid to give way to new exporters with the necessary scale and management capacity to access higher opportunity thresholds. This includes the already known export consortia which plays an important role but also trading companies dedicated to international businesses that may emerge through public-private associations committed to a fair internal distribution of export profits.
(iii) Agreeing on new export channels with friendly countries. This is a promising but also almost unexplored area in which a region’s public and private capitals become partners, as it may be the case of MERCOSUR in South America or the SADC (Southern African Development Community) in South Africa. The goal is to enhance the use of available international resources (regional presence in international entities, facilities in terms of embassies, consulates, promotion agencies, science and technology centers, private and development banking), as well as establishing agreements that prioritize the interests of the countries involved (regional inputs supply for exportable production, development of unified trade management modalities, sharing knowledge, contacts, access to markets).
Beyond the specificity of the analyzed example, what these lines highlight is the need to bring the transformational purpose to the core itself of adopted measures in order to identify synergies and warn about eventual inconsistencies among transformational objectives. Thus the expression ´transformational implosion´ refers to a perspective which, taking into account the existence of technical relationships between aggregate variables, see the fundamental components of a transformational process and weigh up the social, economic, environmental and political effects of each one of the implementation measures to be adopted. By doing so unwanted effects are minimized while bringing down reductionist approaches that contribute to masking interests that are impossible to defend in plain sight.
