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After four rounds of negotiations, those that began in June of this year and which had just ended the negotiations for the conclusion of a new Free Trade Agreement (FTA) between Brazil and Canada. Chile. Increased productive development and trade are among its main benefits. In 2017, 3,578 Chilean SMEs exported to the world, of which 10% registered shipments to Brazil. That is 345 companies.
That is why the new free trade agreement with Brazil generates expectations. "The negotiated agreement, which marks a milestone for its broad coverage in different areas and its level of ambition, will provide valuable support for national SMEs. Latin America, because of its proximity cultural and geographical, is the preferred destination for small and medium-sized companies and Brazil is a key market, "said Rodrigo Yáñez, Direcon's Managing Director.
SMEs must, however, remain vigilant. the results of the electoral panorama of the South American giant.
Among other chapters, the new agreement will consider "trade facilitation"; "E-commerce"; "Competition Policy"; "Temporary entry of persons"; "Good Regulatory Practices"; "Commercial Economic Cooperation" and "Micro, Small and Medium Enterprises (MiPyMES)".
In addition to the SME chapter as such, the agreement includes others that will directly benefit these businesses. For example, public procurement, which will allow Chilean SME suppliers to participate in offers in Brazil, with the same protection and the same treatment as a company in this country.
With regard to electronic commerce, the benefits could be sufficiently profitable. to small and medium-sized enterprises. "It is considering standards that establish the free flow of data and prohibition to require the location of servers, as well as the recognition of electronic signatures from both countries in accordance with their national legislation, which will result in a reduction significant cost of running the system, SMEs, "says Yáñez.
To get an idea of the scope of the agreement, the Internal Revenue Service (SII) indicates that 84% of Chilean companies belong to the micro, small and medium enterprises segment. According to official figures, about 15 million Brazilian companies are members of this sector
. The exchange between Brazil and Chile reached US $ 9,476 million in 2017 (see chart). [19659002] As part of the agreement, the creation of a Mipyme committee was also set up. This will be in charge of promoting and monitoring the agreed activities. For example, the exchange of relevant information, the implementation of work programs and the periodic evaluation of progress, among other responsibilities.
It is important to note that this committee will be composed of the Small Business Division of the Ministry of Economy of Chile, while that of Brazil, the Department of Support to Micro and Small Enterprises of the Ministry of Industry, Foreign Trade and Services and Investment Department of the Ministry of Foreign Affairs
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The Challenges
The experts stress that this agreement will have a positive impact on the sector. "This will generate greater productive and commercial development, which will contribute to the growth of the Chilean economy.
Brazil is the engine of the Latin American economy because it is the most great country of the world, "says Pablo Barberis, deputy director of the consultation area. and Professor FENUbusinesses of the University of Chile.
However, the agreement also poses a problem for SMEs. "Bolsonaro said that he wanted to privatize all state-owned enterprises and significantly lower the corporate tax rate."
This implies that the country – at the level of productivity – is becoming more competitive in order to exit the Brazilian market because it is going to have better comparative advantages over their international competition, "said Barberis.
C & # 39 This is why Chilean SMEs will have to prepare themselves. "Brazil has always been a competitive country and it can now be even more so. In this sense, SMEs would be at a disadvantage.
It is therefore essential that Chilean companies improve their productivity. For example, automating its processes, with increased differentiation and efficiency of operational and administrative flows, "says Barberis.
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