challenges for agro-based exports (including sps)
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Ministry of Food, Agriculture & Livestock
Ministry of Food, Agriculture & Livestock
Challenges for Agro-Based Exports (including SPS)
Presentation on the Final TRTA evenby
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
5
10.9
14.5
60
5.4
9.2
Export Comparison
OthersChemicalsAgri Products
Textile & Clothing Engg. Goods
Source: WTO Database & FBS
World
2003: 7,503 Billion
2.9
22 1.8
63
10.3
2003: 11.2 Billion
Pakistan
TextileEngineering
Goods
10.9
21
55
4.7
8.4
Engineering
Goods
3.1
27.61.3
58.7
9.3
Textile
2005: 14.4 Billion2005: 10,159 Billion
Growth
2003-05
35.4%
Growth 2003-05 21.0%
Ministry of Food, Agriculture & Livestock
S # Commodities2006
2013
Value% Share
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 Categories8 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
S # Commodities
20062013
Value
% Share
Value% Share
Low Sc High Sc
12Meat & 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
14Others (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
8
Afghanistan
1.1 / 3.2
UAE
1.3 / 2.6China
0.5 / 5.0
USA
4.2 / 11.0
Others
1.9 / 4.0
EU
4.5 / 9.5
Textile, Fish, Fruits & Veg, Leather, Cutlery, M & G, Chemicals & Minerals
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
Fruits & Veg, Meat, Leather, Fish, Cutlery, Rice, Sports Goods, Furniture, Eng. Goods, Pharma, M & G, G & J
Textile & Clothing, Carpets, Leather, Eng. Goods, FishSurgical Instruments, Sports Goods, Cutlery, Furniture, M&G,G & J, Rice
Ministry of Food, Agriculture & Livestock
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
RiceConstraints Impeding
Exports Action Plan
Rice Consignments returned from EU because of Aflatoxin
Need to develop new varieties of rice and over come flakiness
Effective regulatory system to monitor residue level Infrastructure facilities –availability of accredited
laboratories for internationally recognized certificates Implementation by MinFAL through TRTA-II
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 trainingTimeline: 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: MINFALTimeline: Immediate
Incentivize/promote seed processing industry/ business
Action : MINFALTime 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
RiceConstraints Impeding
Exports Action Plan
Lack of storage Facilities
Lack of quality packing material causing inferior packing presentation.Refinancing facilities not at par with other industries
Value added industries practically nonexistent
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
Import of zero rated packing materials for re-export purposes only be streamlined.Action: MINFAL/CBR; Timeline: 01 year
Refinancing facilities to be at par with other industriesAction: SBP; Timeline: 01 year
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
Ministry of Food, Agriculture & Livestock
Fruits & Vegetables
Export Benchmark Targets FY06 FY13
$ Bn 0.14 0.9-1.1
Ministry of Food, Agriculture & Livestock
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
Field Heat Removal Packaging
Reefer Transport
Urban Cold Store
Seaport Cold Store
Air Port Cold Store
Local MandiBulk Transport
Whole Saler
Consumer
Retailer8%
3%
20%
2% 1%1%
4%
2%3%
7%
Post Harvest
Total Loss 10-11%3 months
Total Loss 40%3 Days
With Cool Chain
Without Cool Chain
Ministry of Food, Agriculture & Livestock
Meat &Meat Preparation
Export Targets
Export Benchmark Target
FY 06 FY 013
$ Bn 0.02 0.10
Ministry of Food, Agriculture & Livestock
Meat &Meat Preparation
Constraints Impeding Exports Action PlanPoor viability of organized livestock farming due to
Low reproductive efficiency of animalsLimited scope of fattening programsPresence of trade related infectious
diseasesLack 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: 01-02 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 bench mark Target
FY06 FY13
$b 0.20 2.5
Ministry of Food, Agriculture & Livestock
Fish & Fish preparations
Constraints Impeding Exports Action Plan
Inadequate intensification and diversification of inland aquaculture
Non development of coastal aquaculture
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 preparationsConstraints Impeding Exports Action Plan
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
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 & SBPTimeline: 01 year
Ministry of Food, Agriculture & Livestock
Fish &Fish preparationsConstraints Impeding Exports Action Plan
Lack of Tuna Fishing and Processing.
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.
Tuna processing Industry through public-private partnership.Incentives need to be developed
Action: MINFALTimeline: 01-02 years
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: MINFALTimeline: 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. Action Plan
High costs and irregular supply of energy for cold chains and refrigeration
Inadequate training facilities for quality fish handling, processing and marketing
Zero duty and sales tax and five year income tax exemptions as Incentives for refrigerated vehicles and manufactured insulated sandwich panels.
Action: MINFAL & MOFTimeline: 01 year
Provide credit and investment incentives for setting up captive power generation facilities
Action: MINFAL and MOFTimeline: 01-02 years
Fisheries Training Center at Karachi be strengthenedAction: MFD / Karachi Fish HarborTimeline: 01 year
Ministry of Food, Agriculture & Livestock
Compliance of International standards
Constraints Impeding Exports
Action Plan
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
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: MINFALTimeline: 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: IPOTimeline: 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: MOCTimeline: 03-04 years
Ministry of Food, Agriculture & Livestock
Connect to the Market
M A
R K
E T
S
P
R
O D
U
C
T
S
Products to Market
….by upgrading supply capacities and standards infrastructures
DevelopCompetitive ProductionCapability
Prove Conformity with Market
Requirements
Compete Conform Connect
TRADE CAPACITY BUILDING
Approach followed by MinFALApproach followed by MinFAL
Ministry of Food, Agriculture & Livestock
• 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
Initiatives taken by MINFAL to address constraints
Ministry of Food, Agriculture & Livestock
SPS Diplomac
yTechnically
demanding risk management
functionsInstitutional structures and
role clarity
Suitable and applied
regulation and monitoring
Application of basic ‘good practices for hygiene &
safety
Awareness and recognition
The Key Management Tasks Ahead -identified under UNIDO,WB study
Creation of NAPHISCreation of NAPHIS
Effective SPS ManagementEffective SPS Management
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
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