Five lessons from the Latest Latin-American Debacle

The nationalization, without compensation, by Bolivia of a joint venture between Catalonia’s Abertis and Spain’s Aena is the latest episode in a long history of such seizings in Latin America. Therefore, it constitutes an excellent opportunity to stress some of the principles governing international relations, to make sure that Catalan enterprises do not fall again into certain traps.

• Lesson 1:  POLITICS AND ECONOMICS GO HAND IN HAND.  A common misconception states that Catalans should devote themselves to business, while leaving politics and security and defence in the hands of others. Wrong! In many industries, the impact of government regulations and policies is decisive, and companies cannot operate unless a strong state is backing them up. This is why the Catalan defence industry is in such poor state, because at the meetings where the shape of international weapons consortia is decided, no one is there to represent them.

• Lesson 2:  FREE-RIDERS CANNOT EXPECT ANY HELP IN TIMES OF NEED. For the third time in a row, Madrid is asking fellow EU members and other partners for support in the face of nationalizations, and for the third time in a row this is met with silence or at most a few kind words.  Why?  Very easy, when it was these partners who needed (or who need) help, they were ignored, and now they are repaying in kind. Suddenly leaving Iraq, harassing Gibraltar (200 incidents at sea in a year, no direct flights), or failing to offer more than token support to counterterrorism operations in Mali, is not the way to make friends. This is a very important lesson for countries moving to recover their sovereignty, and one Catalonia should never forget. Sooner or later the phone will ring and we must be ready to answer, so that others answer when it is us asking for a favour.

• Lesson 3: LANGUAGES MATTER, AND ENGLISH IS ESSENTIAL. Although Abertis is also present in other regions, some Catalan companies still tend to disproportionately focus on Latin America, among other reasons because few of their managers are fluent in English. There is no excuse for this, and it is something that must change right now. Let us not forget that in the most advanced European countries, everybody speaks English as a second language.

• Lesson 4: AENA IS THE ENEMY, NOT A PARTNER. The Spanish monopoly airport-operator is a first-rate actor in Madrid’s Catalan deindustrialization policy, and directly responsible for the sorrow state of our airports, deprived of direct flights to key economic and political decision centers and disconnected from the railway networks.  The fact that one cannot take a train from Girona, Reus, Lleida, and the new terminal in El Prat, is simply unacceptable and should not be rewarded in any way.

• Lesson 5:  NATIONAL PRESTIGE IS A MUST FOR SUCCESSFUL CORPORATE EXPANSION ABROAD. It is sometimes said that global companies trascend national identities, which is clearly wrong. When a company operates in different countries, it is still seen as “belonging” to the one where it is based, and government and consumer attitudes will very much take this into account. At the consumer level, nations are in many ways a brand, and just like any brand this one needs to be managed. A positive image of one’s country makes it easier to introduce oneself and is the first step towards a successful deal. At the government level, it is strenght which matters. Weaklings afraid of playing a significant role in allied operations, or simply unable to do so because of excessively low defence spending and a lack of a strong military culture, will be seen as easy targets for hostile actions such as the nationalization of their companies.

Summing it up, the lessons for Catalan business leaders are clear: master English, choose your partners wisely, support the recovery of sovereignty to get a state behind you, and be ready to see your sons and daughters fight in faraway lands in US, other allied, NATO, and UN-led operations (with some not coming back) so that this state is seen as serious and credible and you are not left alone in the cold.  

Alex Calvo is a Professor of International Relations and International Law, Head of the IR Department, and Postgraduate Research Director, European University (Barcelona Campus). An expert on Asian security and defence issues, he got his LLB from the School of Oriental and African Studies (SOAS, University of London) and is currently doing an MA in Second World War Studies at the University of Birmingham. He is a former teaching and research fellow at the OSCE Academy in Bishkek (Kyrgyzstan).