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From Venezuela to Quebec

A Persuasive Illustration Of The Benefits Of Free Trade: 
The Sural Group

Montreal, April 18, 2001

In an address to one of the Montreal Conference's International Forums, Dr. Alfredo Riviere, President of Venezuelan company The Sural Group, illustrated how beneficial free trade has been to his company. In the same vein, he insisted on Quebec's openness to free trade, saying that this was one of the key factors that brought Sural to establish a subsidiary in the province.

According to Dr. Riviere, "Integration does not mean creating economic blocs to confront other blocs, but rather to improve the trade opportunities within those trade zones and to negotiate with other continents or regions that have common markets". He went on to point out that integration must take place without discriminatory treatment with respect to both investment and trade. It must guarantee the creation of a large open market that is free to all participants, resulting in larger internal markets. With improved productivity, costs will go down and the labour force will grow and become more highly skilled. All these advantages will be reflected in product quality.

Established in 1975, the Sural group is the largest manufacturer of aluminum rods and one of the world leaders in melting, casting, forming and drawing of industrial aluminum alloys.

"To be honest", said Sural's President, "we first had to understand our role in a changing world and then make the decision to become global. This involved addressing our strengths, investment and re-engineering needs and all other factors associated with taking on the challenge of moving toward internationalization".

With a presence in Europe, North America and Latin, the quarter-of-a-century old company initially relied on the human, technical, energy and natural resources that were available in Venezuela and adapted to the requirements of the region. However, given the size of the market and in order to achieve economies of scale, investments were targeted at export markets. Thinking back on how they positioned the company internationally, Dr. Riviere said that Sural Group underwent a series of administrative changes while closely monitoring the international environment and market trends in order to determine towards which countries or economic blocs its strategies should be oriented and its efforts be directed.

"It has been far from easy. Adapting to innovative and enterprising technological methods was a long and arduous process for our personnel. In addition, conducting market studies and developing markets, demanding the required staff-hours, implementing strategies and securing the necessary funding, are all easier said than done -in actual fact, they require years of preparation and experience- ", acknowledged Sural's President.

But the results didn't take long to materialize for Sural has enjoyed constant growth over the past few years. Sural owes these successes in large part to the development of TECHNOLOGY that has been applied to all its processes; as well as to the enterprising and innovative training of its management. This has enabled Sural to successfully compete on the international stage. According to Dr. Riviere, Sural is very optimistic about the future for the demand for aluminum products, which will continue to grow at a steady pace, especially in the automobile industry.

In this context, Dr. Riviere expressed his pleasure at Quebec's interest in processing aluminum. Given Quebec's openness towards liberalizing trade, it made sense for Sural to consider Quebec as a natural partner for its international expansion strategy.

"During our expansion process, SURAL found that Quebec had energy and natural resources that were very similar to those in Venezuela. We were therefore able to apply ideas and strategies that had already been successfully tested, which among other things enabled us to access the NAFTA market", said Dr. Riviere.

In negotiating with the Quebec Government, Sural found what can be labelled as "a visionary climate that was fully receptive to new technological ideas", as well as the availability of resources for applied research projects, tax and financial incentives for new investments and highly skilled human resources with professional ethics. "This was the beginning of our first company in Quebec", concluded Dr. Riviere.


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