ITC HELPS CURAÇAO WITH ITS NATIONAL EXPORT STRATEGY
The government of Curaçao has recently signed a cooperation agreement with the International Trade Center (ITC) in Geneva, to help the island develop a national export strategy. Anton Said is the expert responsible for the trade development program of the ITC. He talks about the process and the benefits of introducing such a policy.
Said explains that the ultimate objective of a National Export Strategy (NES) is to improve the export performance and competitiveness of a country. When developing a NES, the ITC typically looks at three dimensions, the policy aspects of export development, the existing trade support for private enterprises and the enterprises. “The export strategy can be seen as a roadmap that will identify what constraints there are for exports and the possible solutions”, says Said. The companies are very important in this endeavor. They are the ultimate beneficiaries of the NES. The strategy development process therefore includes an evaluation of the opportunities that the companies can engage in to generate foreign exchange. “The rationale for having a strategy is to enable companies to do more business and contribute to the development of the country”.
Said explains that it is important to make the process easier for the companies. This is in their interest as the principal stakeholders. In Curaçao he would like to see a hands-on approach including the companies. His task is to help formulate what the future direction should be for the business development. “It is important to have an active participation of the stakeholders in the various consultations that will be held. This will enable a better understanding of the problems that the enterprises experience”. This will also help to learn about the potential opportunities that could facilitate the companies to enter new markets. What Said has seen so far in Curaçao, is that there is no shortage of plans, vision and strategies.
“Several plans are very well written out. What is needed is a follow up in the transforming of the words into action”, Said says. He explains that the ITC facilitation with the construct of a national export strategy will not stop at just the formulation phase but will also accompany the country in the steps of implementation. This requires a strong political commitment from top level in the Government. According to Said, that is currently the case in Curaçao. There exists a general agreement for the need and benefits of a national export strategy.
It is furthermore important to ensure that the right structures and mechanisms are in place in order for this strategy to be working effectively. ITC will contribute to ensuring that these structures and systems are present. It is of crucial importance, to coordinate the activities among the many stakeholders -both public and private- that will have a role in implementation of the strategy.
That is the only way that the tangible results will be achieved. Said is very positive about the development of the NES for Curaçao. For him it is important that the process of developing a NES does not conclude with just a piece of paper. It is crucial to also see the start of the implementation of the strategy.
The implementation, he says, starts now, even before the designing of the strategy. It entails the inclusion of the stakeholders in the process. Curaçao already has the right structure and commitment in place to start. Both the Ministry of General Affairs and of Economic Development support the initiative. It is also important to have the commitment of institutions that will be involved in the design and implementation. An advantage that Curaçao has, is that the awareness of the need and determination to realize the NES are high. “Everybody wants this to happen soon and is willing to cooperate”.
The strategy will focus on the main economic sectors. Oil Refining is currently one of the largest foreign exchange generators. Tourism is doing very well at the moment but was stagnant for a few years. Said thinks that this sector has a lot more potential especially if it can be connected to other economic sectors. The financial sector is another important economic pillar but is currently under increasing pressure due to changes in legislation and growing competition from around the world. This sector should continue to be innovative to face competition. Said furthermore refers to the information and communication technology as another sector that could be exploited. He thinks that this sector is not fully exploited yet. There are several initiatives, but these seem to be scattered. Said wants to see other sectors emerging. History shows that although the economy can be diverse, a country can get under pressure when externalities affect one of the sectors. It is therefore important to continue developing the other sectors.
Within the framework of export, there are four economic sectors. Agriculture, Manufacturing, Services and Tourism. Tourism is mentioned apart next to the services sector, as it is being considered a unique sector. Service export areas in general can provide high potential. This will be taken into account when determining priorities as it is important to make efficient use of the limited resources in order to achieve the maximum return.
The manufacturing sector is interesting, as it has the potential for exporting and delivering to the tourism sector. But to grow this sector from the beginning can be a longer road and may require higher investments. Therefore, it is important to understand what the existing manufacturing capacity and skills are that Curaçao can engage in. The capacity knowledge of the Manufacturing Association will be an integral part of the consultations. “The process needs everyone involved. We use the provisions, technical assistance and design of the ITC but it is not about us telling others what to do”. Said expects a good outcome from this cooperation between the ITC and Curaçao.
The St. Lucia experience
St. Lucia went through this process in 2004 after the collapse of its preferential banana trade agreement with Europe. “The island was at that time in a critical situation, as it was almost solely dependent on the banana export”. Its whole trade and foreign exchange income depended on the banana export. When that collapsed the island turned to the ITC for help.
The selected strategy was aimed at diversifying the economy to start generate economic growth. Today that has been achieved and St. Lucia has now turned again to the ITC for a second round of support. It will sign a new agreement for technical assistance to be able to continue building on their achievements.