crnm - private sector trade note - vol 1 2009

8/9/2019 CRNM - Private Sector Trade Note - Vol 1 2009

http://slidepdf.com/reader/full/crnm-private-sector-trade-note-vol-1-2009 1/3

www.crnm.org

Private Sector

A product of the Private Sector Outreach of the Caribbean Regional Negotiating Machinery (CRNM)

Trade ote

+

CARICOM’s (Goods) Export

Performance1

TRADE AGREEMENTS OVERVIEW

Exporters from CARICOM benefit from

a number of trade agreements and

arrangements which provide duty

reductions (for some products) and

complete duty relief for some exports.These arrangements and agreements

cover exports to CARICOM, North

America (USA and Canada), the

European Union (EU), Colombia,

Venezuela and the Dominican

Republic.

Trade Agreements have been

negotiated with Costa Rica and Cuba

but are not yet providing any actual

duty relief to exporters into those

1 All statistics provided by the International TradeCentre market analysis software.

2 Tariff lines refer to the classification method usedby customs authorities to identify products whichare traded. Only product lines generated over US$1mn in sales were examined.

3These exports include re-export (i.e. goodsimported for export without further processing)

markets because these Agreements

have not yet been ratified. In addition,

many developed countries provide duty

relief to developing countries, including

those in CARICOM, through the

Generalized System of Preferences

(GSP). In addition, exports from Least

Developing Countries (LDCs), forCARICOM that refers only to Haiti,

receive generous trade preferences

globally.

EXPORT OVERVIEW

In 2006, CARICOM’s merchandise

(goods) exporters generated

US$19.1bn in export sales (including

intra-regional exports). Export sales

growth was 23% per annum between

2002 and 2006, compared to a global

average export sales growth of 17% per

annum. Therefore generally,

CARICOM’s exporters gained market

share over the 2002 to 2006 period.

Of the roughly 300 tariff lines2 thatwere sold by CARICOM exporters in

2006, 57% were growing and improving

their market share, 24% were growing

but losing market share the remainder

were either stagnant or declining. More

importantly, those products that were

growing and gaining market share

represented roughly 50% of the value

of the region’s export sales, whilst the

export product groups in decline

represented roughly 5%.



www.crnm.org

In 2006, Trinidad and

Tobago merchandise export

sales dominated regional

exports. Export sales are

concentrated in a few

member states as firms inTrinidad/Tobago, Jamaica,

The Bahamas, and Suriname

jointly account for almost

90% of regional export sales.

Trinidad is also the most

“bullish” (dynamic) exporter

growing export sales by 33%

annually between 2002 and

2006. St. Lucia is the second

most dynamic exporter with

export sales growing by 27%

per annum between 2002

and 2006.

However, Antigua &

Barbuda, Grenada,

Dominica, and St. Vincent

and the Grenadines are

retreating from the global

market with significant

declines in export sales over

2002 and 2006.

Between 2002 and 2006,

CARICOM firms generated

under 8% (US$1.5bn) of export sales from within the

region, which still shows a

strong dependence on extra-

regional trade for cross

border earnings. In this

regard, external trade

agreements may have

greater impact on profits for

most firms.

EXPORT MARKETPROFILE

Regional goods exporters

have focused mainly on the

United States of America

(USA) as in 2006, almost 60%

of regional export sales were

generated in that market.

The next closest market was

the United Kingdom with 6%

of regional export revenues.

Canada, France, and

Germany complete the top

five export markets.

Therefore, exporters’

revenues are closely linked

to the success in penetrating

the North American and

European markets.

CARICOM exporters have

preferential market access

(meaning either a trade

agreement or some

unilateral trade

arrangement which provides

some duty reduction or

complete relief for exports

which are “made in”

EXPORTSTop 10 goods exports

2006

1. liquefied natural gas

(US$3.6 bn)

2. aluminium oxide (US$2 bn)3. crude petroleum oils

(US$1.9 bn)

4. anhydrous ammonia

(US$1.5 bn)

5. methanol (US$1.4 bn)

6. rum and tafia (US$316.4

mn)

7. raw sugar cane (US$ 312

mn)

8. unwrought gold (US$268

mn)

9. knitted cotton t-shirts

(US$222 mn)

10. undenatured ethyl alcoho(US$202 mn)

CARICOM) which could be

providing some incentive for

importers in these markets

to do business with regional

firms.

Interestingly, between 2002

and 2006, regional exports

gained market share in a

number of countries. These

countries included China

(58% growth in exports sales

per annum); Poland (98%); Brazil (46%); Colombia

(52%); Ecuador (47%);

Senegal (69%); Republic of

Korea (60%); Lithuania

(143%); India (58%); Israel

(95%); Croatia (56%); Faroe

Islands (116%); United Arab

Emirates (83%); Taiwan

province of China (63%);

Pakistan (108%); and Chile

(108%).

Outside of Colombia,

Poland, Lithuania and

Croatia (EU candidate), the

region has no trade

agreements with any of

these new “bullish” markets,

however, there is greater

export dynamism in these

markets than in those more

Between 2002 and 2006, regional exporters gained market

share in a number of countries.

China (58% growth in exports sales per annum), Poland (98%), Brazil

(46%), Colombia (52%), Ecuador (47%), Senegal (69%), Republic of

Korea (60%), Lithuania (143%), India (58%), Israel (95%), Croatia (56%),

Faroe Islands (116%), United Arab Emirates (83%), Taiwan province of

China (63%), Pakistan (108%) and Chile (108%).

Need MoreInformation on Trade?

These 10 items accounted f

over 60% of the region’s goo

export revenues in 2006, and

such their performance in lar

part determines the region

outcome. However these are

capital intensive businesses wi

long start up and break-ev

periods. In the current econom

environment, it is highly unlikethere will be many ne

entrepreneurs in these secto

Therefore, there has to be

strong focus on stimulating ne

business activities in dynam

exports for the region

compliment the sales of the t

10 products.

www.crnm.or



www.crnm.org

“Regional exports with strong global import demand (i.e. import growthgreater than 20% p.a growth between 2002 and 2006) are long term growth

prospects.”

Financial Consultation

5432 Any Street West

Townsville, State 54321

D YNAMIC “LUCRATIVE” EXPORT OPPORTUNITIES

Between 2002 and 2006, there

has been some dynamism inspecific products, with hyper

growth (i.e. product export

growth at least double the

regional export growth rate-46%)

in, inter alia, frozen fish fillets;

pre-fab buildings; wrist watches;

unfermented fruit/vegetable

juices; chocolate; essential oils of

citrus fruits; insulated winding

wire of copper gold; ethyl alcohol;

original sculptures/statuary of any

material; t-shirts/singlets andother vests; organo sulphur

compounds; tunas/skipjack

prepared or preserved;

bituminous oil shale/tar/sands;

plywood; iron waste/scrap;

diamonds; iron

ores/concentrates; electricconductors; shrimps/prawns;

refined sugar in solid form; live

horses; mens/boys

trousers/shorts; rubber/plastic

footwear; and jewellery.

There are also relatively less

bullish export products (growing

their sales by less than 46% p.a)

which however are still

experiencing higher export sales

growth than global import

expenditure growth over 2002 to2006. This implies that these

sectors are expanding their export

share into the global market. These

include fresh/chilled tuna (yellowfin);

tropical hardwood lumber sawn

lengthwise to greater than 6 mm; pebbles/gravel/broken or crushed;

fresh papaya; minced fish meat; cane

molasses; cigarettes containing

tobacco; mollusks; grapefruit juice;

non-coniferous logs;

paints/varnishes; natural sands;

electric lamps/lighting fittings; glass

containers of capacity 0.33-1 litre;

electrical relays; perfumes/toilet

waters; dried fish; plastic boxes

crates; urea resins; condensed milk;

processed cheese and wood shingles.

These products are apparentlybecoming more lucrative business

opportunities, as their export share is

increasing.

Regional exports with strong global

import demand (i.e. import growth

greater than 20% p.a growth

between 2002 and 2006) are long

term growth prospects. Where the

region’s export products experience

slow growth, or even declining global

import demand, it will be importantfor firms to begin transitioning into

products with greater global import

dynamism such as these identified

below.

Of the region’s exports, those with

dynamic global import spending

growth over 2002 to 2006 included

prepared nuts/seeds; refined sugar;

sails of synthetic fibres; stainless

steel waste/scrap; sweet potatoes;

undenatured ethyl alcohol of

strength greater than 80%; semi-manufactured gold; aromatic

hydrocarbon mixtures; aluminium

waste/scrap; vodka; iron

waste/scrap; iron ores and

concentrates; continuously shaped

non-coniferous lumber; essential oils

of vetiver; appliance parts; and

iron/steel grill netting/fencing.

DECLINING “BEARISH” EXPORTS

Between 2002 to 2006, there was a

retreat from exporting a number of

products. In some cases, productswere in global decline, however, in

most cases regional export decline

was observed even when there

was global dynamism in import

spending.

Products that can be considered as

“bearish” exports, or exports in

retreat between 2002 and 2006

include coffee; Portland cement;

pullovers/cardigans of man-made

fibres;

womens/girls panties;

limestone flux; cocoa beans; toilet

soaps/preparations; sanitary

articles of paper (incl diapers);

fresh vegetables; food

preparations (incl sauces,

ketchup); nutmeg; rice; processed/preserved fruits;

aluminium hydroxide; cotton

not carded or combed; sugar

confectionery; fruits of the

genus capsicum (pimento); malt

extract preparations; insulin;

cosmetics/beauty preps; paper

sacks/bags; wooden furniture;

soups/broths; frozen lobsters;

mixtures of fruit juices;

avocados and soya bean oil.

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crnm - private sector trade note - vol 1 2009

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