Spain and the United States - Real Instituto Elcano

FOREIGN TRADE 83
speaking, is to penetrate the domestic market and not to generate trade flows
with the United States. 5
Ireland is another interesting example. Its market share of America’s
foreign purchases rose almost fivefold from 0.4% in 1991 to 1.9% in 2004,
making it the twelfth-largest supplier. This increase was largely the result of
intra-company trade resulting from a big rise in Irish direct investment in the
United States and US investment in Ireland. Spain’s market share is just about
holding steady; in order to increase it exports to the United States will have to
grow at a much faster pace or a lot more direct investment will be needed.
Spain’s exports to the United States grew by 12% in 2004, according to US
figures, compared with 56% for Nigeria, 45% for Venezuela, 37% for Russia,
22% for Belgium and 29% for China (which that year overtook Japan as the
world’s third-largest exporter).
A commonly heard complaint about Spanish companies is that they do not
always have a sufficiently large stock to sell, so that when an importer places
an order it cannot be filled. Some consumer goods companies only want to sell
symbolic amounts in the United States, as this can help them open doors into
other much easier markets where the company can impress clients by saying
that it sells to Saks Fifth Avenue or Neiman Marcus.
This is the case, for example, with some wines, although Spanish wines are
increasingly well rated by specialist publications in the United States, such as
The Wine Spectator, the bible of the wine trade. Six of Spain’s wines were
ranked among the world’s top 100 wines in 2004, and one of them was in the
number three spot, the highest place so far achieved by a Spanish wine (see
Exhibit 4.7). Also, Freixenet is the best-selling sparkling wine (cava) in the
United States. Exports of Spanish wines to the United States have been on an
upward trend since 2000 (see Exhibit 4.8).
The US market is a tough one to break into, but the rewards can be
considerable. An example of this is Inoxcrom, which makes and distributes
writing instruments. In 1996 Jordi Piqué, who had left Barcelona to work in
Australia, where he boosted the company’s position from 78th to 4th place by
sales volume, proposed that Inoxcrom study the potential of the US market.
The results were encouraging, and Inoxcrom set up a subsidiary in New Jersey
in 1997. In 2004, US-based Inoxcrom Inc generated sales of $25 million,
almost half its worldwide sales.
5. See “La Economía de Estado Unidos, El Sector Exterior y las Relaciones Comerciales Bilaterales” by
Manuel Moreno Pinedo (Boletín Económico de ICE, 2839, March 21-April 3, 2005).