Friday, November 8, 2013

South-South technological dependency

The increase in South-South trade noted here before is not necessarily symmetrical and there are winners and losers too with this type of integration.
When speaking of Argentina’s economic, cultural or technological dependency, it is usually seen as a matter of north-south relationships. Now then, are there south-south dependencies? In the field of industry and technology, the answer seems to be affirmative. 
Historically, Argentina has heavily depended on Brazil’s manufacturing development. “Argentina is a country characterized by an important level of technological dependence which in the last 10 years, far from reverting, deepened,” states Martín Schorr, researcher from CONICET in the Facultad Latinoamericana de Ciencias Sociales (FLACSO). “The trade surplus is kept basically by the agricultural sector, some agro-industries, and the mining sector. The rest of the industrial network produces losses.” 
Of the total of Argentina’s export to Brazil in 2011, products with industrial origin represented 67 percent. At first sight, that’s not bad. However, of those industrial products, only 6.7 percent are machinery and electrical appliances; that is, goods of higher technological development. On the other hand, that same year Argentina imported from Brazil 87 percent of products with industrial origin, of which 18.5 percent was machinery and electrical appliances. 
Thus, even though Brazil’s situation is not the best either, in both cases the balance is unfavorable towards Argentina. “Brazil is losing space in the rest of the world in matters of export of technological goods, but it compensated this with exports to Mercosur. In fact, the main destination of this type of exports is Argentina,” states Eduardo Crespo, economist and researcher from Universidade Federal do Rio de Janeiro (UFRJ).
Read the whole thing here.

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