Industrial Policy

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Industrial Policy

Industrial policy is the set of actions aimed at resolving market distortions; i.e., when free market allocations of goods and services in the economy are not efficient. Among these market distortions are externalities, monopolies or oligopolies, incomplete markets, asymmetric information and coordination of agents. Similarly, industrial policy actions are conducive to collaboration between the private sector and government to develop those sectors that have a greater impact on economic growth. Industrial policy seeks more balanced regional growth by exploiting comparative advantages and leveraging knowledge spills and scale economies to further economic development.

The objectives of industrial policy focus on providing information to economic agents; implementing specific actions and instruments for the promotion of human capital and financing and, coordinating, targeting and prioritizing joint actions between the private sector and different levels of government.

Thus, programs implemented by the Ministry of Economy follow these premises as guidelines:

  1. To strengthen and develop the domestic market with the same robustness as the foreign market.

  2. To strengthen nascent industries which have competitive advantages.

  3. To enhance innovation, the promotion of human capital and technology exchange among industries.

  4. To provide information to agents to resolve market distortions, particularly asymmetric information and coordination of agents.

  5. To coordinate, target and prioritize joint actions between the private sector and different levels of government.