R:Hey there, I’m Robyifan. and This is Ignacio Tornero, founder of EAST CONSULTING. Well, Ignacio, a pleasure, let’s talk about LATAM and Asia business.
1- LATAM and Asia business – Did you notice a need in the market?
I: Yes, East Consulting provides services in both directions; Chinese companies that invest in Latin America, and Latin American companies doing business in China. And the interest existed a long time ago. In other words, in the Latin American case towards China started with the topic of exporting products,. Raw material such as copper, soybeans, wine, the agro-industrial world, cherries, etc., salmon… And that materialized with the signing of certain free trade agreements.
The Chilean case, was the first country to sign a free trade agreement in the world, as an individual economy with China in 2005. That was the turning point where all this trade that previously existed began to grow steadily. Opportunities for more formal establishments generated that is Latin American companies that wanted to have a stable presence in China to be able to do it. Banks, companies in the retail sector, vineyards, companies in the agro-industrial world, fisheries, etc.
And in the opposite case, that is, Chinese companies, doing business in the region is something rather recent.
Chinese companies have been investing in Latin America for about a decade, because chinese companies in general did not invest in the world until the beginning of the year 2000. It´s something rather recent. And that was the trend that we wanted to promote because there are many barriers. Which we can obviously comment on later, to advising Chinese companies on their investment in Latin America and helping to promote Latin American companies that are doing business there. LATAM and Asia business
2- Why Singapore?
I: Excellent, the truth is that this is my second time in Singapore. The first one was in 2016, it was a visit quite brief. For tourism and this visit takes place in the context of the academic world, as you mentioned Rob. I´m adjunct professor at the Pontifical Catholic University of Chile. I also have a role as a research associate at the Center for International Studies at the same University.
So, following the invitation of a US think tank called The Interamerican Dialogue. Which is an entity based in Washington DC, and in cooperation with the School of Public Policy and the Lee Kuan Yew School of Public Policy of the National University of Singapore. They created a conference that addresses China’s engagement in Latin America and ASEAN. About 25-30 academics around the world were invited to address these trends. Of whether there are any similarities or differences between the Chinese presence in the Latin American region, such as in the Southeast Asian region…
And that was the reason for the visit, and in any case, to take advantage of seeing business opportunities here for East Consulting as well. Singapore for us is a market. The truth is that we are interested, perhaps, in the medium term, in having some sort of presence. Latin American companies are considering alternative places to China, especially to be able to approach the Southeast Asian area. I think that Singapore has a lot of strength in this regard as well. And why not think, nowadays it’s quite incipient, that companies from Singapore can invest in our region, which is what China has done in the last 10 years. LATAM and Asia business
EAST CONSULTING.
R: Now that you are talking about these advice services offered by your company, perhaps you could tell us what is the best way to find you or how could they find you, maybe online…?
I: We, East Consulting, are a team of three people and the strategy has been to have a presence, at a regional level, both in Latin America and in Asia. Emilia Chen, she’s my partner, and she’s based in Beijing, and Adrian Cuevas is based in Taipei, Taiwan. Obviously nowadays everything also works remotely, online. I think all these connectivity tools have allowed that too. I’m the person who is the point of contact for East Consulting in Latin America based in Santiago. LATAM and Asia business
R: I believe that Latinos like us, who have made the leap to Asia, did something different at some point in their lives…
3- Could you tell us a little about the beginning of your journey to this part of the world…?
I: Yes, the truth is that, in my particular case, it was somewhat anecdotal… I love telling the story because it’s related to my grandmother in particular. She, for reasons and circumstances of my grandfather’s social life, visited China in 1987. Invited by the Chinese government, then, in fact, she had the opportunity to find out a long time ago what was happening. What was coming in China. The great progress, the economic development. She was the one who encouraged me to study the language. In 2006.
I entered the Faculty of Law of the Pontifical Catholic University of Chile in Santiago to study law. There I made the decision, encouraged by my grandmother, to study the language. The truth is that everything persevered over time. In my fourth year of university, I made the decision to go to Nanjing University as an exchange student. to advance in my studies of Chinese languages and that ultimately allowed me to see with my own eyes what was happening in China.
The deep changes. The little connection that there was in the legal world, or in general with Latin America. There was a huge opportunity. And besides that, I loved the experience. I had the opportunity to travel within China. To rather remote, rural provinces and also travel through the Asian region. When I returned after a year and a half, I made the decision. I definitely wanted to dedicate myself to this, to connect China, and Asia with Latin America.
FIRST CONTACT WITH CHINA
R: I can also say that I had a very similar experience in this regard. That first contact with China. After going it’s difficult to come back to Latin America and believe that this is enough. You’ve already seen other things. You’ve already seen the future, and at least I couldn’t just stay there. I felt like the pace was making me go slower than the others. It’s like knowing that you’re late just by not doing anything about it. To see how they bring you closer to the model that the Asian countries have…
4- What would you consider to be what we continue to do in Latin America that makes us go a little slower than other regions…?
I: I think there are many elements for which Asia, China is advancing very quickly… One of them I think is associated with how big is the population. For us in Chile, we are a rather small country. As a country with 17.18 million inhabitants, I think there is a factor of internal competition. There is a need in China to progress, and to keep moving forward because the competition is huge. That is point number one.
Secondly, I believe that we, Latin America in general, we are a less cosmopolitan region than China. Asia in general, not only currently but historically. See, for example, how in China, in the ninth century. There were people from different parts of the world who wanted to trade with this region because there were a lot of resources. For example, silk, and porcelain. And we have not necessarily been exposed to that exchange. It’s obviously a cosmopolitan multicultural world. It generates a much higher speed in society and in the economy than now.
The third point I think is related to many factors. but it is perhaps, mentioning only some of them, the structure of governments. In that sense, I think that Singapore in particular and China, have government structures, and political systems that are very different from what we are used to in Latin America. We are used to democratic systems. With a very regular alternation. Instead here, for example, in the case of Singapore. It’s very interesting to see how the government and the governmental structure have been a critical factors in generating this change. To generate this speed of change and I think, with some differences, they can also be seen in the case of China.
SINGAPORE – COSTA RICA
R: Precisely what you say is very important to me, especially because to us in Costa Rica. We are told the story that Singapore and Costa Rica, around 1950, they were very similar. It was almost the same size and something happened… Of course, the vocalization helps Singapore. But at the same time maybe it was the decision, of what are we going to do differently. And how in a matter of 50 and 60 years everything could have been different. LATAM and Asia business
5- Do you think that there’s some advantage as Latinos, something that perhaps, people from Asia who want to invest in Latin America can consider as an advantage of choosing this region and not another…LATAM and Asia business?
I: One of them that can be an advantage, and at the same time a challenge. I think that has been the case of the number of natural resources that we have…
We have a population, except for the case of Brazil. Which is a country with a very large population. Although it has a territory and immense geography.
We have a lot of natural resources. I think there is an obvious complementarity with China and with Asia in general. Being able to be suppliers of different raw materials to these regions of the world, that many of them have.
In the Chinese case is clear
the large deficits, food deficits, deficits in metals or raw materials to produce other goods in these markets. That’s a chance, anyway, I think it’s used in the sense of the Chilean case of being large exporters of copper today, as well as other agro-industrial products such as fruits, products such as wine, products such as salmon. The Peruvian case, also the mining, very important, in the Argentinian case, in the Uruguayan case, from Brazil the world of livestock, soy world.
But that generates a trap for you, which is to say that you can’t get out of there, that it’s only exporting a raw material without taking away an added value, that obviously creates an important challenge and that as a first place.
LATAM
The second thing is that, especially in certain countries in Latin America, and I would especially like to emphasize the case of Costa Rica, which is one of them.
The case of Colombia, the case of Chile, a certain institutional solidity, where the rules of the game are quite clear.
There is a fairly sophisticated rule of law that makes the investments from these Asian countries in our countries stable, returns can be expected.
I would tell you that those are probably two advantages that I would like to emphasize. LATAM and Asia business
What represents LATAM now…
R: Clearly, the idea that people have of Latin America today is a little different from what it was a few years ago. Now it looks more like what we really consider it to be, which is an emerging market, full of opportunities that have not yet been exploited. This moment that Latin America is going through now, where is already considered something different, it’s the first time that it happens at least in the last 10 years. The first technology unicorns are starting to appear. LATAM and Asia business
6- LATAM and Asia business: What do you think has caused this to happen?
I: It’s associated with a new generation of younger people, people who have had the opportunity to get educated, or travel to other parts of the world, and in general, they are not looking for a place at the Latin American level. The case of unicorns, for example, Chile, companies that call my attention a lot, like the case of Not Company, the case of Cornershop, and others, it seems that it’s remarkable.
I believe that it’s associated with that, a much more connected generation, a more global generation, a generation that has had the opportunity both to travel physically or to have digital access to the trends that are happening in other parts of the world, and it’s also a much more daring generation, a less risk-averse generation, less traditional in the sense that it no longer conceives of work as it might have been in the past, but it is a generation that wants to generate changes.
I believe that entrepreneurship, in general, is associated with that also, to a new lifestyle, to dare, to less aversion to risk, to more digitization, to see the world in a more connected and global way than probably previous generations in our countries. LATAM and Asia business
NEW GENERATIONS
R: It makes perfect sense, even I would consider that maybe some new generations, I would say that if they don’t take that risk, maybe they can’t guarantee success, and even long-term remuneration, since nothing guarantees that the job will be there for you for the next 10 years, and if this decision to invest or even of entrepreneurship is not made, you may not be able to think in the long term about where are you going to put your money. LATAM and Asia business
I: I think it’s also associated with exposure to other success stories, because you see that there is a company from Costa Rica, or Peruvian, or Brazilian, which has been founded by a group of very young people has been successful, and that effect is generated, why we can’t do it. In the Chilean case I think it’s remarkable, to see that the first technology companies generated that boom. LATAM and Asia business
STARTUPS, STARTUPS, STARTUPS…
R: I remember seeing a few years ago that these technology events, that were StartUp Chile, StartUp Mexico, who were among the first, and I even remember friends of mine, who traveled from Costa Rica to participate in these events to show their ideas for their companies, because they knew that it was there where they could get an investment round. LATAM and Asia business
I: You are talking about something that seems very interesting to me, which is the intervention that the state has in these types of trends, And I think that in the Chilean case, the StartUp Chile program, as you mention as a Costa Rican, is very interesting, because it attracted a lot of talent worldwide, and I think that this is not only generated as bottom up, but there is also a very interesting opportunity, and connecting it with what we talked about before related to Singapore and China, that is, the role and the difference that the state can have in that I think is vital, I think the public-private partnership is a very interesting catalyst or accelerator in entrepreneurship. In the Chilean case, I think, that program was extremely successful.
R: And even why not out of curiosity perhaps some kind of enterprising tourism, for those who just want to go see what opportunities they can get in neighboring countries. You, who already have experience, who have already traveled, and who have seen what is out there…
7- Is there any advice you see for young people, for those who are beginning to consider whether to build companies or to start a business, any advice that you think will point them in the right direction…?
I: I believe that there is not necessarily a decision or a correct path, but my advice would be in two ways: one is that they dare to leave their comfort zone, obviously leaving the traditional world of work generates a lot of uncertainty, and you have to venture, today you can save some money, travel the world, and seek inspiration where you want to go, and I think that’s important…
The second thing and this is generally something that I comment on repeatedly… In the world of entrepreneurship or doing different things, is a long-term task, so it’s not like you, in a year, can put together a start-up that is successful, but it really requires a lot of perseverance. It’s a piece of advice for generations that are younger than us, is that you must have a medium to long-term vision to really be successful. In my particular case.
I’ve been developing myself, dedicating myself to China issues since 2006, we are talking about more than 15 years, and in certain aspects, I’m just beginning to see the fruits of it. Then the world of entrepreneurship sometimes it is seen from the outside as very easy, that it’s something that benefits are necessarily going to come in the short term but that is not real, So I believe that a vision, or medium and long-term planning, associated with an energy of leaving that comfort zone and daring to do something different, things with perseverance, the results will come by themselves. LATAM and Asia business
LATAM and Asia business – Life Changing Moments
R: I read somewhere that there are usually about 3 moments in life, 3 important decisions throughout life that changes one’s life completely, and I believe that traveling, and traveling very far to a completely different culture, I think it’s one of those things that can change you wherever you are, this year or the next one. LATAM and Asia business
I: In my particular case, I agree 100%, that was in fact the moment when a very important change in my life really took place, it was in 2009 when I had the opportunity to study in China, at Nanjing University, It was the opportunity where it materialized, and made visible this idea that I had in mind, the opportunity to connect with people from all over the world, to realize that the world works in a very global way, to see that other countries, also other people, were more advanced than me in the project that I wanted to carry out.
COOPERATION
That’s the third piece of advice, it’s associated with cooperation between people, that is, it’s very common in certain societies, there is that degree of support, through mentoring, through the financing of start-ups, etc., and not necessarily the Latin American society is something that we recurrently see, and when you have the opportunity to travel or move to these societies or countries where everything is working very well, opportunities are generated, because tomorrow it may be that, for example, you have an idea to form a company, a technology startup, but you don’t have the funding to do it, and it may be that in that travel experience, you find the right person or the person who in 15 more years, It’s going to be the one who is going to finance your venture, and you will never know that.
Final Thoughts
R: That person may be just starting that business right now, but in 15 years they already have or will have the money to invest in you. Well, thank you very much for this interview, and it’s a pleasure to have you here in Singapore, I hope that we will see each other again and if not, that we will see each other in Chile, in any case, it will be a pleasure. Thank you very much! LATAM and Asia business
I: Thank you so much, Rob, a pleasure.
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