Diego Cesar Bunge – President, Argentine-Dutch Chamber of Commerce, Argentina
The president of the Dutch Chamber of Commerce in Argentina highlights the significance of the bilateral relationship of both countries. Furthermore, he explains how the current government is implanting profound change for the benefit of business and society at large.
Could you please briefly introduce us to the Dutch Chamber of Commerce in Argentina?
“We can look back on a deeply rooted presence of Dutch business in the Argentinean business community with excellent ties with their Argentinean peers and the domestic community.”
We are close to reaching a century of existence in Argentina, however, we have some members who can look back onto an even longer history in Argentina; Royal Dutch Shell is just one example. Some of the other companies with a tremendous impact in Argentina include Philips and Unilever. Our member companies are involved in all aspects of the Argentinean economy and are broadly positioned.
What can you tell us about the evolution of the bilateral relationship in between Argentina and the Netherlands?
The most glamorous aspect is that we were lucky enough that the Queen of the Netherlands was born in Argentina! Other than that, we can look back on a deeply rooted presence of Dutch business in the Argentinean business community with excellent ties with their Argentinean peers and the domestic community. It has been a continuous objective of the Dutch companies in Argentina to also support the development of the community it does business in and thus has had its share of influence of the development of certain traditions. For instance, in the suburbs and surrounding lands of Buenos Aires, one of the most relished products in social gatherings is a special type of Dutch gin (genever Bols). Just one aspect of past Dutch influence in Argentina’s reality today! Overall, one can see that when Dutch companies come to Argentina they come to stay, mostly because the Argentinean and the Dutch economies are complementary and not competitive.
In which areas are the two economies complementary?
In most industries active in Argentina; these include energy generation, agribusiness, creative and innovation industries and especially water sanitation and flooding treatment. Another highly interesting area is infrastructure – not only building it but also in terms of maintenance, servicing and logistics!
What are you main priorities as a chamber?
The main priorities of the chamber are to proactively shape the business conditions in Argentina thus improving the ease of doing business for our member companies. We are focused on creating an environment which will allow President Macri to fulfil one of his ambitions for his administration: that Argentina become a full member of OECD. To achieve this goal, certain rules and regulations have to be implemented and strictly followed, best practices have to be adapted in several areas. The country’s administration is already focusing on these structural changes and we are witnessing these developments with utmost attention, trying to participate to full extent if possible.
The Netherlands is one of the most technologically advanced countries, how can the chamber act as facilitator bringing this technology into Argentina?
We have already been working on shaping the business environment abiding to OECD standards prior to the election of President Macri. Obviously the success was limited, as the previous government simply did not accept abiding to international standards. To use a simple metaphor: the previous government played football as every other nation does, just without rules all other teams follow and in a basketball court, but called it football nonetheless. Now we see profound and well-structured change, because that is what the Argentinean people rooted for on December 10th 2015 –for the benefit of all individuals in the Argentinean society! Not only will the business environment be positively affected, these developments will bring improvement across the board as a sustainable environment where the rule of law is in charge is being created. This will create a much needed equilibrium of rights and obligations of every member of society.
Rule of law is an important aspect for investors. In the context, what is the sentiment of confidence into Argentina within your member companies?
What we witness is that many of the business opportunities that were already existing prior to the administration change, are now regarded with much higher interest than under the previous government. At the same time, potential investors –as well as our members—are closely observing how and if needed changes are implemented. The ground rules to actually do business on a long-term basis need to be fully implemented. Sustainable rules, a regulatory framework, civil code provisions; these are just few of the aspects that need to be adapted to OECD’s standards. This administration is committed to reforming these aspects and has already shown to the world its willingness to do so rapidly. Some of the bills for these reform plans are already submitted to congress—namely the bills on PPP and PPA agreements—which we expect to be established towards the end of this year. We also witness the process when we participate in forums or conferences and in interaction with members of the national administration, World Bank or the Inter-American Development Bank. As much praise we have for the developments and the transformation, I must highlight that how these changes are implemented is crucial! They must be long-term, so that bankable long-term contracts are possible and start building the backbone of our economy.
How can you help companies to tap into these unfolding opportunities in Argentina?
We participate and establish forums in which these matters are being discussed with government officials and members of Civil Society. We have regular meetings with our members in private where everybody can freely disclose their present and past concerns as well as their individual experiences in Argentina. These past experiences are often a topic; Argentina has a special history of investor treatment which is not easily forgotten and often things are analyzed and discussed with this background. Especially in light of future opportunities we often scrutinize if what happened in the past can possibly happen again.
What do you tell Dutch companies interested in Argentina?
We tell them that we are witnessing a process where significant changes are taking place and that there are significant business opportunities. Particular interest comes in regard to participation in infrastructure construction, technical advice, related services and providing technology. We explain the possibilities of the current establishment of the PPP umbrella under which many of these companies are already participating in other jurisdictions such as Brazil, Colombia, Peru or Mexico.
What is the significance of the PPP bill?
Approving the PPP bill presented in Congress would be a major message to the international business community that satisfactory ground rules are being established, ultimately enabling long-term projects for the benefit of business community and society at large. Moreover, it will be a strong political message showcasing the political strength of the current government which is initiating a cultural change within Argentina. Cultural change, as in how foreign investments are treated by the associations, public and private stakeholders. Currently, there is a large cultural drawback in the sense that the relationship between the Argentinean federal and national administrations and the private sector counterparts has to be conducted under exorbitant rules in favor of the state which makes these kind of arrangements almost impossible. Luckily, this issue is addressed by our current administration and we will see significant improvements soon. The future in Argentina is highly promising. The government has already shown that they can build structures which adhere to guidelines internationally respected and accepted.
Argentina is a significant market for Dutch companies which offers a vast array of opportunities to Dutch businesses. Dutch companies are usually highly specialized and have tremendous expertise in their field of business which can be easily applied in Argentina, complementing what is already being done.
Argentina is currently in the spotlight of the international business and political community. How do you ensure that the Dutch influence within Argentina sustains?
The strength of the Argentinean – Dutch relationship goes beyond business. It is not only the long-term presence of Dutch activities in Argentina, it is more that the Netherlands is a country which has a tradition of respecting international law, human rights, being an active player and seat of the setting process of international standards and acceptance of immigration; simultaneously, the Dutch perspective on conducting business in a sustainable manner and according to international best practices completes the character which has strongly impacted the development of Argentina as well. I am confident that the relationship of Argentina and the Netherlands will even further prosper in the future on the same basis it has done over many decades now. One of the incentives we set as Chamber of Commerce is, that we are currently working on establishing as a public – private effort a university platform in which universities of both countries have the possibilities to set-up joint graduate programs with dual degree recognition for interested students from both nations. We are confident that this kind of collaboration will greatly benefit both populations and furthermore equip young graduates with a broader understanding of the intercultural exchange and appreciation of both countries.
Seeing that the Dutch chamber has a history of almost 100 years in the country, what would you consider its defining qualities which allowed it to sustain that long?
I would argue that the Dutch business approach –straight to the point and quite frank—is one of the aspects proven to be prolific. People know what to expect right from the beginning and are aware of the state of the current relationship. I see now Argentina orientating by these values as well. Not only politically but also from a business perspective we witness profound changes in the ground rules of doing business. In that respect one aspect to be emphasized is that the rule of law is now a valued paradigm, something that did not happen during the past fifteen years.