Transcript Challenges for Agro-Based Exports (including SPS)

Ministry of Food, Agriculture &
Livestock
Challenges for
Agro-Based Exports (including SPS)
Presentation on the Final TRTA even
by
Aisha Humera,
Deputy Secretary
Ministry of Food,Agriculture and Livestock (MINFAL)
Ministry of Food, Agriculture &
Livestock
Target for the current year
To enhance the current export to GDP
ratio from around 13% to 15% in 6-7 years
Ministry of Food, Agriculture &
Livestock
Export projections for the year
2007-08

Determined to implement Rapid
Export Growth Strategy (REGS) and
to achieve high export growth rate,
export target of US$19.2 Bn is set
for the year 2007-08.
Ministry of Food, Agriculture &
Livestock
Export Comparison
World
Pakistan
2003: 7,503 Billion
2003: 11.2 Billion
22
14.5
10.9
1.8
2.9
10.3
9.2
5.4
63
60
2005: 14.4 Billion
2005: 10,159 Billion
27.6
1.3
21
10.9
8.4
4.7
55
Textile &
Clothing
Agri
Products
Growt
h
200305
35.4%
3.1
Growth
2003-05
21.0%
9.3
Chemicals
58.7
Engg. Goods
Source: WTO Database & FBS
Ministry of Food, Agriculture &
Livestock
Others
2013
2006
S#
% Share
Commodities
Value
Value
% Share
Low Sc
High Sc
Core Category
1
Textile & Garments
9.89
60.0
22-25
55.0
55.5
2
Rice
1.11
6.7
2.5-3.0
6.2
6.7
3
Leather & Leather Products
1.09
6.6
2.5-2.80
6.2
6.2
4
Sports Goods
0.35
2.1
0.90-1.0
2.2
2.2
5
Carpets & Rugs Tapestry
0.25
1.5
0.35-0.40
0.9
1.0
Development Categories
8
Fish & Fish Preparations
0.20
1.2
1.00-1.20
2.5
2.6
9
Fruits & Vegetables
0.14
0.8
0.35-0.50
0.9
1.1
Ministry of Food, Agriculture &
Livestock
2013
2006
S#
% Share
Commodities
Value
Value
%
Share
Low Sc
High Sc
12
Meat & Meat
Preparations
0.02
0.1
0.10
0.2
0.2
13
Wheat
0.00
0.0
0.3-0.4
0.7
0.8
14
Others
(Chem/Petro/Stationery
etc.)
2.79
17.0
4.77-3.98
11.9
8.4
15
Total Export
16.47
100.0
40-45
100.0
100.0
16
GDP
128.90
270-280
17
Export – GDP Ratio (%)
13
15-16
15
16
Ministry of Food, Agriculture &
Livestock
UAE
Textile, Fish, Fruits & Veg,
Leather, Cutlery, M & G,
Chemicals & Minerals
1.3 / 2.6
Fruits & Veg.
Ghee, Meat,
Milk, Wheat,
Eng. Goods,
Furniture,
G & J, surgical,
Textile, Rice,
Cutlery
Fruits & Veg,
Fish, Textile
Carpets,
Leather,
Surgical, S.
Goods, Eng.
Goods,
M & G, G & J
Afghanistan
China
1.1 / 3.2
0.5 / 5.0
USA
4.2 / 11.0
EU
4.5 / 9.5
Others
1.9 / 4.0
Fruits & Veg, Meat, Leather,
Fish, Cutlery, Rice, Sports
Goods, Furniture, Eng. Goods,
Pharma, M & G, G & J
Ministry of Food, Agriculture &
Livestock
Textile &
Clothing,
Carpets,
Leather, Eng.
Goods, Fish
Surgical
Instruments,
Sports Goods,
Cutlery,
Furniture,
M&G,G & J,
Rice
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Pakistan’s image continues to be that of a low quality, low
price, non consistent and unreliable supplier
Low to medium technology and low R&D capabilities.
Infrastructure deficit in energy, water and roads etc. Poor
technological infrastructure.
Absence of integrated and holistic medium to long term export
strategy
Low productivity and low agriculture yield
Average quality of products and lack of brand names
Low value addition & Low level of foreign direct investment in
manufacturing /exportable sectors.
Non-facilitative taxation system
High cost of doing business despite some positive indications
Lack of product and geographical diversification in exports
Weak export culture and drive.
Absence of economies of scale in engineering sector
Ministry of Food, Agriculture &
Livestock
Major Challenges for
Agro-Based exports



Low-competitiveness on supply side
Lack of productive capacity (as a result of
low investment in new machinery and
technology leading to lower productivity and
high costs)
Tax treatment that favors investment in the
non-industrial sectors ,particularly
speculative businesses i.e; stocks and real
estate

Low end and low quality products

Fragmented and informally organized export
industries
Ministry of Food, Agriculture &
Livestock
Major Challenges for
Agro-Based exports





Unmatched demand for energy
Market access on demand
side(compliance with international
standards)
Compliance with social,environment
and health standards
Insufficient product diversification
competitiveness
Ministry of Food, Agriculture &
Livestock
Major Challenges for
Agro-Based exports





Cold Chain to minimize post harvest
losses
High interest rate and lack of
infrastructure
Lack of modern storage facilities
SPS requirements
Grading,packing,fumigation,testing
and certification problems.
Ministry of Food, Agriculture &
Livestock
Rice
Constraints Impeding
Exports
Rice Consignments
returned from EU
because of Aflatoxin
Action Plan
Effective regulatory system to monitor residue level
 Infrastructure facilities –availability of accredited
laboratories for internationally recognized certificates
Implementation by MinFAL through TRTA-II


Need to develop new
varieties of rice and over
come flakiness
Adequate Funds and Up-gradation of RRI of Kala
Shah Kakoo and Dhokri
Timeline: 01 to 02 years
 Professionals be hired from foreign countries to
give training
Timeline: Immediate
 Stakeholders be on the research advisory
committee
Timeline: Immediate
Action: MINFAL in collaboration with
Provincial Govts.
Ministry of Food, Agriculture &
Livestock
Rice
Constraints Impeding Exports
Action Plan
Non-availability of quality
(selected, processed, treated)
seeds of existing varieties
Abundant and timely availability of
best quality seeds (no duty and taxes)
Action: MINFAL
Timeline: Immediate
Incentivize/promote seed processing
industry/ business
Action : MINFAL
Time Line: 01 Year
“Basmati Rice” is not yet
geographically defined. India has
already registered it under the
Trade Mark of “Super” and is
expected to acquire further market
share of top basmati exports
market segment
Geographical Indication (GI) of Super
Basmati as a genuine product of
Pakistan both in EU and USA is
required
Action: MINFAL + MoC
Timeline: Immediate
Ministry of Food, Agriculture &
Livestock
Rice
Constraints Impeding
Exports
Action Plan
Lack of storage Facilities
Warehousing facility of one million ton capacity
available at Karachi (Pipri/Landhi may be leased out to
the Rice Exporters.
Action: TCP; Time Line: 01 Years
Lack of quality packing
material causing inferior
packing presentation.
Refinancing facilities not at
par with other industries
Import of zero rated packing materials for re-export
purposes only be streamlined.
Action: MINFAL/CBR; Timeline: 01 year
Value added industries
practically nonexistent
Develop feasibility reports for value added products,
by-products like, fortified rice, pre-cooked rice, ready
to eat rice, cereals, rice oil etc.
Incentivize local manufacturing of quality rice
machinery and programme lending scheme for
technology up-gradation of rice milling & processing
industry
Action: TDAP; Timeline:01-02 years
Refinancing facilities to be at par with other industries
Action: SBP; Timeline: 01 year
Ministry of Food, Agriculture &
Livestock
Fruits & Vegetables
Export
Benchmark
FY06
$ Bn
0.14
Ministry of Food, Agriculture &
Livestock
Targets
FY13
0.9-1.1
Constraints Impeding Exports
Action Plan
Lack of quality products for export
To develop and up-grade seeds of quality fruits & vegetables
(Kinnow, Mango, Dates, Peach, Potato & Onion etc.) establish
product specific research institutes
Action: MINFAL in collaboration with PHDEB, PARC, NIAB,
NIBG & Prov. Govts.
Timeline: 01-02 years
Lack of Cool Chain System i.e.
cold storages & reefer
transportation
Establishment of cool chains at three levels will reduce pre and
post harvest losses from 40 to around 10%. Flow diagram
referred
Under the National Trade Corridor Improvement Programme
(NTCIP), following initiatives will be taken:
 39 modern pack houses completely automated & equipped
with advanced electronic devices for packing /grading and
storage plants will be set upat 31 fruits & vegetables growing
areas throughout the country.
 23 facilities for cold storage and controlled atmosphere
storage will be established at the food production areas
 Two container yards in Karachi &Lahore with a pool of 200
refrigerated containers and 50 controlled atmosphere
refrigerated containers at each location will be established.
Ministry of Food, Agriculture &
Livestock
Total Loss 10-11%
With Cool Chain 3 months
Air Port
Cold Store
3%
Field Heat
Removal
4%
2%
1%
Reefer
Transport
Packaging
1%
Urban Cold
Store
3%
Seaport
Cold Store
2%
Whole Saler
8%
Bulk
Transport
7%
Local Mandi
20%
Post Harvest
Retailer
Without Cool Chain 3 Days
Ministry of Food, Agriculture &
Livestock
Total Loss 40%
C
o
n
s
u
m
e
r
Meat &Meat Preparation
Export Targets
Export
Benchmark
FY 06
$ Bn
0.02
Target
FY 013
0.10
Ministry of Food, Agriculture &
Livestock
Meat &Meat Preparation
Constraints Impeding Exports
Action Plan
Poor viability of organized livestock farming
due to

Low reproductive efficiency of animals

Limited scope of fattening programs

Presence of trade related infectious
diseases

Lack of research on refinement of
vaccines (F&M,BSE etc)
and disease diagnosis
To improve viability of livestock farming action required are:

Establish Livestock Production Research Institutes in
Sindh, NWFP, Balochistan and Southern Punjab

Establishing mobile livestock health care units on fast
track basis.

LDDB has initiated several projects for fattening farms
Poor management of public slaughter houses
Public sector slaughter houses to be privatized and
permission to build and operate slaughter houses in private
sector be accorded
Ministry of Food, Agriculture &
Livestock
Meat &Meat preparation
Constraints Impeding Exports
Action Plan
By-product of slaughtered livestock
not adequately processed and
marketed
Foreign expertise may be acquired for establishment of
slaughter house by-products plants and development of
effective marketing system
Action: MINFAL and Prov. Livestock Deptts.Timeline: 0102 years
Absence of large livestock farms
Model dairy farms to be enhanced from the present 650
to 2400 by 2013
Joint ventures with foreign investors may be
explored/established
Action: Prov. Livestock Deptts.Timeline: 02-03 years
Poorly managed and maintained
infrastructure in livestock markets
All levies collected from livestock markets to be
reinvested in these markets to improve infrastructural
facilities
Meat export processing zones be established. These
zones are to be regulated as disease free as per OIE
requirements
(Action: Prov. Govt.)
Action: Prov. Finance and Livestock
Deptts.
Timeline: 02 years
Ministry of Food, Agriculture &
Livestock
Export target for Fish & Fish
Preparations
Export
$b
bench mark
FY06
0.20
Ministry of Food, Agriculture &
Livestock
Target
FY13
2.5
Fish & Fish preparations
Constraints Impeding Exports
Inadequate intensification and
diversification of inland aquaculture
Non development of coastal
aquaculture
Action Plan
Introduction of new species with higher yield.
Introduction of intensive fish farming
R&D for fish feed and disease control
Action: Prov. Fisheries Depts.
Timeline: 01-02 years
Shrimp aquaculture along creeks and shallow waters
near the coast has to be developed.
Action: MINFAL/MFD
Timeline: 02-03 years
Ministry of Food, Agriculture &
Livestock
Fish &fish preparations
Constraints Impeding Exports
High Post Harvest Losses.

No insulation in fish holds of more than
8000 fishing boats.

No technical equipment e.g. Winches,
Radio, GPS, Fish Finders.

Very little use of fish crates causing
crushing of fish.

Polluted block ice
Action Plan
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Un tapped fishing zone (12-20 miles).

Lack of investment in big and faster
launches for deep water fishing, 12-20
nautical miles, for want of credit.

Modification of fish-holds with insulated sandwich
panels and designed to accommodate fish crates.
Provision of Winches, GPS and Fish finders to
decrease fishing time.
Mandatory use of fish crates in fishing boats.
Plate ice plant 300 tons / day on BOO.
Action: MINFAL/MFD/Provincial
Govt. &
FHA
Timeline: 02-03 years
Pilot project with modern technology to
manufacture new high speed fishing boats in
composite material.
Adequate soft credit may be provided to the private
sector for investment in boats and fishing
equipment.
Action: MFD, FHA & SBP
Timeline: 01 year
Ministry of Food, Agriculture &
Livestock
Fish &Fish preparations
Constraints Impeding Exports
Lack of Tuna Fishing and Processing.
Action Plan
Tuna processing Industry through public-private
partnership.
Incentives need to be developed
Action: MINFAL
Timeline: 01-02 years
Lack of development of new fish harbors,
especially in Balochistan coastal area.
Non operation of Korangi Fish harbour
Lack of adequate processing facilities for
quality exports.
Incentives for the private sector for partnership on BOT
and BOO basis
Action: MINFAL/CBR/Prov.Govts
Timeline: 03 years
Immediate execution of operational plan of Korangi
Fish Harbour
Action: MINFAL
Timeline: 01 year

Establishment of hygienic peeling facilities.

Value added fish processing industry by
incentivizing private sector
Action: MINFAL & KFHA
Timeline: 02 years
Ministry of Food, Agriculture &
Livestock
Fish & Fish preparations
Constraints Impeding Exports.
High costs and irregular supply of energy for
cold chains and refrigeration
Inadequate training facilities for quality fish
handling, processing and marketing
Action Plan
Zero duty and sales tax and five year income tax
exemptions as Incentives for refrigerated vehicles and
manufactured insulated sandwich panels.
Action: MINFAL & MOF
Timeline: 01 year
Provide credit and investment incentives for setting up
captive power generation facilities
Action: MINFAL and MOF
Timeline: 01-02 years
Fisheries Training Center at Karachi be strengthened
Action: MFD / Karachi Fish Harbor
Timeline: 01 year
Ministry of Food, Agriculture &
Livestock
Compliance of International standards
Constraints Impeding Exports
Progress towards compliance to the
standards imposed by importing
countries at the borders (SPS,
IPR,CSI,) and those imposed by the
customers (ISO certification, Labor,
environmental standards) is slow
Action Plan
Sanitary & Phytosanitary (SPS) Management
 Review and needed amendment of Food, Plant, Animal &
Fisheries quarantine laws are to be made.
 Measures to address GMO issues are to be taken.
 Integration of agricultural (plant & animal) and health border
control institutions is to be ensured.
Action: MINFAL
Timeline: 06-07 years
Intellectual Property Rights
To meet legal obligations under the TRIPs, speedy enforcement
of IPRs (e.g. IPR violation of optic discs and patent
obligations) is required.
Action: IPO
Timeline: 06-07 years
Social Accountability-8000 Certification
To ensure better implementation of Human and Worker rights.
awareness campaign and SA-8000 certification of exporting
firms may be carried out the earliest
Action: MOC
Timeline: 03-04 years
Ministry of Food, Agriculture &
Livestock
Approach followed by MinFAL
TRADE CAPACITY BUILDING
P
R
O
D
U
C
T
S
Products to Market
Develop
Competitive
Production
Capability
Compete
Prove Conformity
with Market
Requirements
Conform
Connect to
the Market
Connect
….by upgrading supply capacities and standards infrastructures
Ministry of Food, Agriculture &
Livestock
M
A
R
K
E
T
S
Initiatives taken by MINFAL to address
constraints
•
NAPHIS- A coordinating body for all SPS matters.
•
Developing strategy for cold chain in consultation with
MoC under NTCIP
•
Developing zones for horticulture and Livestock in
consultation with PHEDB and LDDB
•
Investing in HR development-mega project of PARC
•
Creation of Trade and Investment Unit in the
•
Economic Wing of MinFAL
•
Restructuring of MinFAL-Leadership role as a
Knowledge based organization
Ministry of Food, Agriculture &
Livestock
Creation of NAPHIS
Effective SPS Management
The Key Management Tasks Ahead -identified under UNIDO,WB study
SPS
Diplomacy
Technically demanding
risk management
functions
Institutional
structures and role
clarity
Suitable and
applied regulation
and monitoring
Application of basic ‘good
practices for hygiene & safety
Awareness and
recognition
Ministry of Food, Agriculture &
Livestock
Export Market Development

There is a need to link quality product with
an appropriate market assistance required from
TRTA-II through a twining arrangement of
technical assistance through UNIDO and ITC


Need to develop product and market
specific studies &action plans
HR development
Ministry of Food, Agriculture &
Livestock
THANK YOU
Ministry of Food, Agriculture &
Livestock