Taking into account that yesterday the Council of Ministers ended the Covid pandemic with the suspension of the mandatory use of masks in pharmacies and hospitals, any portrait that offers an analysis of what it was and what we experienced in 2020 will allow us to better understand towards where are we going.
This is the case after the latest report from the GECE Observatory, presented yesterday at a conference organized by CaixaBank and the Ivie at the headquarters of the financial entity in Valencia, dedicated to analyzing the changes that occurred in the international positioning of Valencian companies during and after COVID-19.
The conclusions of the GECE Observatory are mainly two. First, that the position in foreign markets could have been beneficial to offset the risk derived from national restrictions in certain markets. In other words, it maintains that exports had a “positive effect”, since, on average, sales abroad evolved “somewhat more favorably” than local ones.
In general terms, in 2020, the percentage of sales abroad out of the total grew by 1.2 percentage points on average for companies in the Valencian Community, while the increase in Spain was 0.3 percentage points. In 2021 this increase remained stable (in the Valencian Community) or increased slightly (in Spain). The most notable increase occurred in the case of large Valencian companies, whose percentage of international sales grew 2.1 points in 2020.
The other main conclusion is the type of international incursion that the Valencian companies made. And from GECE’s conclusions, it can be seen that the most competitive risked little and concentrated in markets that they dominated, mainly the European Union.
It is the large and medium-sized companies (both in the Community and in Spain) that concentrate their international activity mainly in the EU, while micro and small-sized companies present a greater diversity of geographical destinations in their exports. Companies reporting an export presence in Asia declined in virtually all business size categories.
According to the study coordinated by Carlos Albert and Alejandro Escribá, both researchers from the Ivie and the University of Valencia, companies focus on selected markets, where the company can achieve and exploit competitive advantages.
On the other hand, the Observatory has also studied direct investment through subsidiaries and the pattern changes. He points out that the larger company size is clearly associated with a greater diversity of geographical areas. “The largest companies use subsidiaries in a greater number of geographical areas, in search of greater control of global positioning in their internationalization strategy,” the report states.
Overall, in the Valencian Community, the weight of companies with subsidiaries located in two or more geographical areas went from 17.4% in 2019 to 21.4% in 2021 of the total number of companies with subsidiaries, a percentage somewhat lower than the national average (23.8% in 2021). The European Union is also the preferred location for setting up subsidiaries, followed by South America, although during the pandemic, medium-sized and large Valencian companies have accentuated their presence in North America.
