Transcript Hon. Luis Ramón Rodríguez, Minister of Agriculture

WORKING TOGETHER TO BUILD
AGRICULTURAL EXPORTS TO EUROPE
UK-CENTRAL AMERICA NEW BUSINESS
OPPORTUNITIES
ING. LUIS RAMÓN RODRÍGUEZ, MSC.
Minister of Agriculture
Dominican Republic
The SICA Region: Profile
Economic Outlook for 2014
Trade Agreements
The Role of Agricultural Sector in
SICA Economies
Value Added Agricultural
Production
Exports and Imports
Business Opportunities
The SICA Region: Profile
The SICA region is comprised by the
seven countries of Central America
(Belize, El Salvador, Guatemala,
Honduras, Nicaragua, Costa Rica,
Panamá) and Dominican Republic,
that holds the Pro-Tempore
Presidency for the first semester of
2014.
The SICA Region: Profile
Population: 52 million
GDP of US$417Bn in 2013
Average Gross National Income grew
from US$4,360 in 2011 to US$4,721 in
2012.
Production of agricultural commodities
And tropical produce, such as fruits,
vegetables, coffee, cacao, bananas and
others.
Gross National Product (GNP) of SICA Countries for 2013
US$ Billions
(*) Millardos = Billon USA
Source: WEO/FMI, Octubre 2013
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The SICA Region: Profile
A bridge between South America and
the European Union; a door to the North
American market through the DR-CAFTA;
rising intercontinental trading with the
expansion of the Panama canal; strategic
Location; trade logistics infrastructure:
hubs and warehousing committed to
move forward regional integration for
sound economic development and trade
competitiveness.
Economic Outlook for 2014
FMI estimates a global growth of 3.7% for 2014
FMI growth projections for SICA region is 3.9%.
Trade exchange is projected to rise to 4.5% from a 2.7% in
2013.
Agricultural products are expected to be a key factor in the
region´s growth.
Economic Outlook for 2014
Expected Market Performance:
OECD estimates price increases over the next coming years due to
slower production and stronger global demand and the growth in
China´s market.
Consumption increase in developing countries, driven by growing
populations, higher incomes, urbanization and changing in diets.
Per capita consumption is projected to expand most rapidly in Eastern
Europe, and Central Asia followed by Latin America and Asia.
Emerging economies will capture much of the trade growth, accounting
for the majority of exports of coarse grains, rice, oilseeds, vegetable oil,
sugar, beef, poultry and fish.
8
Total Trade Exchange of the European Union with the World - 2000/13
(in Billions of Euros)
Import
1,739.4
1,234.3
Export
1,682.7
992.7
1,101.7
849.7
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
Variación 2013 con 2009
UE27 to World…….. +57.8%
World to UE27……… +36.3%
2000
2,000
1,800
1,600
1,400
1,200
1,000
800
600
400
200
0
Source: EuroStats
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Trade Agreements
DR-CAFTA Changed the pace of economic development of the region by:
 Strengthened and diversified trade relations between SICA and
the United States.
 Boosting economic growth and political cooperation between
Central American states and the US.
 Leading reforms at the legal, infrastructure, logistics and
business environment levels
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Trade Agreements
Central America- Dominican Republic Agreement
Signed in 1998 between Dominican Republic and Central
American countries with the exception of Panama.
• Promoted regional exchange, eliminating trade barriers and
propelling regional investment.
• Products manufactured on Tax Free Zones are not
included.
• Implemented as a bilateral agreement between Dominican
Republic and the signatory countries.
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Trade Agreements
EPA-CARIFORUM (Dominican Republic and Belize)
Opened a bridge for trade exchange consolidating free
access to the EU market.
•
Fostered trade-related cooperation issues and investment
promotion.
•
Duty-free quota-free access for all products to the EU
market.
•
Technical cooperation for modernization of customs
procedures and trade facilitation.
•
Capacity building on procedures and international trade
standards.
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Trade Agreements
EU-CENTRAL AMERICA
Relies on three pillars: political dialogue, cooperation, and
trade.
• Foster business and investment opportunities.
• Reinforces economic integration among the Central
American countries.
• SICA exporters have duty free access for 91% of their
products.
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SICA Region Share of EU Global Trade Exchange
( 2010/13)
SICA
0.54%
SICA
0.40%
Rest
Rest
99.60%
99.46%
EU global exports
EU global imports
Source: EuroStats
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The Role of Agricultural Sector in SICA
Economies
Agricultural production is a major contributor in the
economic development of SICA countries , ranging from
4% of GDP in Panama to 20 % in Nicaragua for 2012,
with an average of 11% for the region.
Common objective of the SICA Ministries of Agriculture:
•
•
•
•
Improve productivity and promote competitiveness.
Production planning with market oriented approach.
Compliance with international food safety standards.
Promote business climate for public-private partnerships
and FDI.
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Market Share of the European Union Agricultural Global Trade 2010/13
(average %)
Agri
6.6%
Rest
93.4%
Global Exports
Agri
6.9%
Rest
93.1%
Gobal Imports
Source: EuroStats
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Market Share of the SICA Countries Agricultural Trade with EU27
SICA
0.59%
Rest
99.41%
Exports UE27 to World
SICA
3.14%
Rest
96.86%
Import UE27 from World
Source: EuroStats
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Total Trade Between EU and SICA Region - 2000/13
(000.000 Euros)
12,000
Export
Import
10,000
8,425.3
6,000
4,000
5,323.9
8,000
4,960.8
7,453.8
5,263.4
5,058.7
Variation 2013 to 2009
UE27 to SICA…….. +41.6%
SICA to UE27……… +58.2%
2,000
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
0
Source: EuroStats
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The Role of Agricultural Sector in SICA
Economies
Share of Agricultural Sector on GDP of SICA Countries
Country
2011
2012
6.10%
6%
3.80%
4%
9.70%
13%
6.20%
6%
17.50%
20%
12.80%
15%
10.50%
12%
13%
12%
Dominican Republic
Panama
Belize
Costa Rica
Nicaragua
Honduras
El Salvador
Guatemala
Source: Worldbank
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Market Share of Agricultural Goods in the Imports of UE 27 from SICA
Region 2013 (%)
100%
87.85%
90%
83.94%
80%
70.01%
70%
60%
96.43%
95.19%
58.45%
50%
35.67%
40%
25.58%
30%
20%
10%
0%
DOM
CRI
HON
GUA
ESA
NIC
BEL
PAN
Fuente: EuroStats
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The Role of Agricultural Sector in SICA
Economies
Areas for investment opportunities:
• Joint
Ventures
in
greenhouses
and
fresh
vegetables
production.
• Renewable energy projects.
• New technologies such as greenhouse production, organic
farming.
• Improvement in trade facilitation: Logistics, food processing
and packaging, warehousing, and market access.
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The Role of Agricultural Sector in SICA
Economies
Regional agricultural development is lead by the Central
America Agricultural Council (CAC), a body of the
SICA that joins all the Agricultural Ministers under the
Protocol of Guatemala.
Role: spearhead and promote integration of the region’s
agricultural sector.
CAC scope of actions
1. Climate change and risk management
2. Farm agriculture
3. Rural Development
4. Sanitary and safety procedures
5. Technology, information and innovation
6. Competitiveness, trade and agribusiness
7. Food security and nutrition
Source: EuroStats
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The Role of Agricultural Sector in SICA
Economies
• Competitive advantages in the agricultural value-chain.
• Certified organic production.
• Most organic farming produced under a fair trade model
for sustainable development of agribusiness
• Dominican Republic: largest global exporter of organic
banana, organic cocoa, mango, coffee and vegetables
• Costa Rica: Banano, pineapple, coffee and cocoa.
• Guatemala: Internationally known for organic coffee
exports
• El Salvador: Fresh vegetables.
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Exports and Imports
• The bulk of most Central America countries trade has been
with USA and Latin America.
• Trade exchange between SICA countries and EU has been
relatively modest until now.
• The most important exports from the EU to Central America
are machinery and transport equipment (47.2%) and
chemicals (21.5% in 2012).
• Principal UK exports are beverages, medicinal and
pharmaceutical products, road vehicles, specialized industrial
machinery,
electrical
machinery
and
miscellaneous
manufactured articles.
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Total Trade Between EU and SICA Region - 2000/13
(000.000 Euros)
EU Exports
Source: EuroStats
EU Imports
EU Exports: Euros 7,453.8 mo.
EU Imports: Euros 8,425.2 mo.
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Trade of Agricultural Goods Between EU and SICA Region - 2000/13
(000.000 Euros)
(*) Agriculture= HS 01 to 24
Variation 2013 to 2009
UE27 to SICA…….. +66.5%
SICA to UE27……… +24.7%
Source: EuroStats
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Export and Import of Markets in the European Union with 27
Countries of SICA
Export UE27
Source: EuroStats
Import UE27
Export UE27 = Euros 711.4 mm.
Import UE27 = Euros 3,717.5 mm.
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Trade of Agricultural Goods between EU and Individual SICA Countries in
2013 (000.000 Euros)
1400.0
Export
Import
1200.0
Export UE27 = Euros 711.4 mo.
1000.0
800.0
600.0
11.2
20.1
51.1
78.7
51.0
73.8
200.0
211.4
214.0
400.0
0.0
DOM
CRI
HON
GUA
ESA
NIC
BEL
PAN
Source: EuroStats
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Average % of EU Imports of Fruits, Coffee, Tea and Species - 2010/13
SICA
10.40%
SICA
10.50%
World
89.50%
Fruits Imports :15.090 billion EUR
World
89.60%
Coffee, tea and species Imports: 9.033 billion EUR
Source: EuroStats
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Average % of EU Imports of Ornamental Plants, Flowers and Tobacco 2010/13
SICA
2.84
%
Rest
97.16
%
Plants and flowers Import: 1.532 mm EUR
SICA
2.75
%
Rest
97.25
%
Tobacco Imports: 2.591 mm EUR
Source: EuroStats
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Business Opportunities
The SICA region is determined to boost its competitive
advantages of location, agricultural production and tourism.
• Integration policies are moving forward agricultural
modernization.
• Tourism, manufacturing and service industries are
becoming increasingly important.
• Mining is just in the first stages of development.
• The expansion of the Panama canal is opening
exponential opportunities in transportation service and
logistics.
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Business Opportunities
• Investment opportunities are supported by demands from the
expansion and diversification of its economies such as:
• Farm inputs and related technologies for agribusiness
• Animal breeding and capital intensive production processes.
• Development of infrastructure in roads, urban transportation
systems, ports improvement, merchant marine and trade
facilitation, in general.
• Logistics warehousing services for exports of perishable
• Distribution services on European Union markets for export
products.
• Renewable energy and wastewater treatment plants
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Business Opportunities
Ecological Profile
The clean energy sector in SICA region is expanding.
The region’s natural resources offer potential for the development of
marine, solar, geothermal, wind and bio power generation and several
projects are already underway
• Costa Rica has no registration requirements or project approval
processes for new investments. No specific limitations are applicable to
foreign investments.
• In general Costa Rica does not have any special laws governing
foreign investments.
• Its free zone industry is under the Free Zone Regime Law that
provides benefits and incentives on raw materials, machinery and
equipment for certain types of vehicles.
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Business Opportunities
Dominican Republic legal framework offers incentives and guarantees for investments in
several sectors.
•
Foreign investment Law and Free Trade Zones for Exports carry important incentives for
investments in tourism and production/manufacturing.
•
Housing Projects Law (189-11) is aimed at promoting real estate financing with direct
incentives for low cost housing development .
•
Renewable Energy Law (57-07) provides incentives in energy generation from renewable
sources.
•
Solar and wind farms projects are already in progress and two bio-fuel power plants will
start within 2014.
•
Film Industry Law (108 -10) sets up incentives for the filmmaking industry, local filmmaking
production and on studio´s construction.
•
One-stop Investment Counter is in the process of being implemented, to accelerate and
streamline procedures related to national and foreign investment.
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Business Opportunities
• Nicaragua has various incentive laws for priority sectors, such as
the Tourism Incentive Law, the Renewable Energy Incentive Law
and the Free Trade Zones Law for export-oriented industries.
• Guatemala has a foreign investment law dating back to 1998 to
promote foreign direct investment. There are no restrictions on
foreign investment in the telecommunications, electrical powergeneration, airline, or ground-transportation sectors.
• New legislation for Public Private Partnerships has been enacted to
attract investments towards large-scale construction projects.
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Business Opportunities
Panama has a bilateral investment agreement with the
United Kingdom and has been a member of the
International Centre for the Settlement of Investment
Disputes (ICSID) since 2001.
A particular area of opportunity for foreign investors is in
the former Canal Zone and associated military bases.
Panama Pacific, one of its facilities, has been singled as a
special economic incentives zone for investments on the
“new town” infrastructure concept.
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THANK YOU !!!
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