The promotion of Agricultural SME’s in Belize for the Export Market Print E-mail
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Friday, 25 October 2013 00:00

SME workshopA two day workshop on the international promotion of agricultural Small and Medium Enterprises SME’s ended on Wednesday at the George Price Center for Peace and Development in Belmopan. The Workshop was brought about by the Belize Trade and Investment Development Service (BELTRAIDE) working in cooperation with the Ministry of Foreign Affairs (MFA), the Inter-American Institute for Cooperation on Agriculture (IICA) and the Latin American and Caribbean Economic System (SELA).

SME’s account for more than 95% of all enterprises in Latin America and the Caribbean (LAC) ; however the Small Firms and the Medium Sized firms only account for 1.8% and 6.4% in exports, respectively. What has been established during these two days in Belmopan was that despite the low export within the LAC, the current move of trade liberalization, characterized by a sharp reduction in trade barriers and in transportation, communication and information costs, has opened vast opportunities for SME’s. Frank Lam from IICA, who spoke on Tuesday on the Challenges and Opportunities to these foreign markets, told us that Belize has tremendous advantages as the only English speaking Country in Central America and should maintain its course in making Agriculture its main stay.

The potential for SME’s in the LAC to tap into these foreign markets is huge, says Frank. For example, the Bahamas imports 44 million dollars a month in food or one million dollars worth of food a day.

Thus; it was not surprising that earlier this year, Cabinet approved the SME Policy and Strategy to help small businesses to start-up, grow and to become a part of the formal economy. That policy and strategy is now being implemented by BELTRAIDE. As part of a vibrant program within BELTAIDE, some 150 businesses have been assisted during a one year period. Such an assistance has been rendered by the Small Business Development Center (SBDC) now based at the University of Belize Campus in Belize City.

In his keynote address on Tuesday, Michael Singh, Chief Executive Officer within the Ministry of Trade Investment Promotion, Private Sector Development and Consumer Protection stressed on the values of innovation for SME’s. According to Michael Singh, innovation entails investment aimed at producing new knowledge and using it in various applications. It results from the interaction of a range of complementary assets which include research and development, but also software, human capital, design, marketing and new organizational structures.

One of those innovative organizational structures for the promotion of SME’s was being promoted on both Tuesday and Wednesday at the George Price Center by Carlos Lopez Cerda, consultant for the United Nations Industrial Development Organization (UNIDO-Mexico). The idea of Carlos Cerda is that a single SME would not have the resources to have an ample reach of the foreign markets; thus the need for an ‘Export Consortium’.

Economic groupings such as the Export Consortium has been popularized in Italy where some 500 of such structures exist and accounts for some 10% of that Country’s exports. The Export Consortium is a group of businesses, which shares both the cost of promotion and logistics in its reach of foreign markets but at the same time continue to partition their unique business activity.
Anil Sinha from the Caribbean Agriculture Research and Development Institute CARDI advised yesterday that Belize should take advantage of such an Export Consortium to supply vegetables to outside restaurants and high end resorts; since the local market cannot adequately pay for the vegetables.

During the two day workshop at the George Price Center there was also ample opportunity to discover the current stumbling blocks that SME’s have in tapping into the export market. John Carr from Banana Bank proclaimed that Belize has some 50,000 acres of corn growing in Belize. But the problem arises when seeking payment in the Guatemalan market, since his customers pay in Quetzal. By the time businessman John Carr has transferred his Quetzal from Guatemala to a Bank in the United States, and then proceeds to transfer the U.S dollars to Belize, some 20% in bank transaction costs have already eroded into the profits.