Shanghai 2008

Shanghai 2008

About two years ago, I wrote to several politicians, business leaders and Economic analysts to share with them my worries about the evolution of certain parameters of capital flows, and about certain ratios of several sector debts, that in my limited vision of that moment, I could not understand, but they seemed already alarming to me.Only two of them answered to me: the first one, a good friend of mine, replied saying that my pessimistic point of view of the future to come was not correct because, although he agreed in some of my opinions, the results forecasted by me were absolutely impossible to happen. He said that if my predictions were true, there would be a major crisis, much higher of what the economic authorities from the countries involved would ever permit. The second, a funny guy who writes editorials in a famous economical newspaper, replied me with a drawing and three laughs “ha, ha, ha” in big letters written with a thick pen.

The truth is that I thought that my points of view and my theories maybe were too catastrophic, and that I should devote Sunday mornings to play golf instead of thinking about writing worrying letters. In fact, the “ha, ha, ha”, upset me and the drawing showed clearly to me his opinion about my eschatological letter.

In August 2007, after a difficult July from a business point of view, and worried because of my responsibility as president of AMEC – a non-profit-making business association of companies in Catalonia promoting exports and its internationalisation – I felt the urge of writing another letter, in which I wanted to make the readers think about different opinions about the society, the university and about companies that deeply worried me. In my letter – written in a style to avoid again being considered catastrophist – I was already speaking about what was then the beginning of the present-day crisis.

I sent this letter to some political and business leaders, and as well, to the media, who published some of my opinions, but who did not understand all the important message concerning the difficulties that would soon come for the companies, the economy and the country.

In AMEC we were expecting more replies than those we got, the majority of them curiously from the political parties in the opposition – who later used some of these opinions of the letter in the Parliament – and few from the different political parties who are now in the government, who thought that my opinions were basically discrepancies to the way they rule the country instead of seeing it as an analysis of the global situation and a clear lack of vision for many years.

I also had to give further explanations in some Minister’s offices and to express my worries, pointing out that my opinions were not intended to be read as an hostile fatwa.

For some years I have been denouncing to the most important authorities of the country as well as openly in different media and forums, the harmful treatment that the spanish Ministry of Finance has given to those companies that made efforts in research and innovation. Many companies have decided to stop investing in research and innovation and others have drastically reduced its investments to avoid the constant persecution of the inspectors and sub-inspectors of the spanish Ministry of Finance that presumably want to get their annual bonuses. Those companies that had a fine, and those companies that have been denied a compensation after investing an important amount of money in research and innovation should be officially compensated and recognized.

It is difficult for a country to improve with a Ministry of Innovation that encourages companies to investigate, and at the same time a Ministry of Finance that does not believe in it, and comes with big and sharp scissors and uses them with those companies that believe that research and innovation are the only ways to guarantee a better future to companies and to the country.

In April 2008, I sent a letter to the president of the European Central Bank, Mr. Jean Claude Trichet, in which I expressed him my worries for the lack of competitiveness for European companies due to the big gap between the USD and Euro, and also the high interest rates in the Euro Zone, both issues putting in big difficulties to European companies to develop their expansion plans. On the other hand, US companies were then very competitive, and could offer in many international markets better prices, obviously thanks to lower interest rates in US. We all know that the competitiveness of American companies is higher than that of European companies, specially with regards to many other reasons different from the interest rates or a strong or weak US Dollar.

In my letter to Mr. Trichet I did point out some solutions to change the interest rates and restore the economy of European companies, that were already losing many business possibilities in many markets not only because of an advantageous American offer but also because of a strong and competitive offer from Chinese and Asia-Pacific companies. His reply was kind and polite, but in his comments was clear that the European Central Bank was then only worried by inflation and that other issues did not matter at all. Now, when we are living in an already industrial crisis – although unbelievable – he did not change their point of views.

Weeks before the presidential elections in Spain – as I was aware of what was to come – I did express loud and crystal-clear in the AMEC-Export magazine that a candidate to become Prime Minister in a country should not offer money coming from a surplus from the taxes that individuals and companies did pay. The candidate won, did give the money from this surplus and today the country is suffering this decision.

When this candidate become Prime Minister, I had the chance to ask him in a meeting organized by the Círculo de Economía in Barcelona if the government would increase the VAT, and I insisted in knowing how much the increase would be and when would it happen.

He replied that there would not be an increase of the VAT. I still think he was wrong, and I am quite sure that before the end of 2008, he will have to decide when and how much he will have to raise this tax, in order to be able to meet the many compromises of his government and as a partial solution to the crisis he finally admitted that exists.

At the end of July 2008, and in the middle of the crisis, I did send a letter to the Spanish Prime Minister to remind him that all individuals as well as the companies in Spain must pay the taxes on time. If we do not pay them on time we must pay important fines. On the other hand, in July 2008 the Ministry of Finance still had not returned to the company I work for the VAT rebates on exports since January 2008. This long delay was seriously affecting our investments and daily plans. Luckily, in early August this issue was solved.

I am quite sure that others like me have experienced similar situations. And I am also convinced that they have also expressed to governments and institutions their worries and the answers that had received were empty, as if the issues that worry companies and individuals were not of their concern.

Frankly speaking, I must say that the present-day crisis is not only due to Wall Street speculators, the subprime culture of “everybody is invited to the party” and to their partners in the US and Europe, but specially to a profound lack of leadership of governments and the society.

Well, in fact, a lack of leadership of individuals that are serious and honest in their daily work, that give trust to others to make of this world of ours a more balanced and responsible, socially speaking.

With this type of persons leading important institutions worldwide, in governments and in companies, there would be no place for speculators in Wall Street and bad politicians in governments.

That is why we should use what we studied in school, colleges and universities every day in our jobs and always bearing in mind that our main professional aim should always contain a veneer of honesty. This would permit us that our generations to come could live in a world in which their economic and political institutions had honest and capable leaders.

Leaders that could guarantee a better future.

Comments are closed.