• Like
Destination Central America
Upcoming SlideShare
Loading in...5
×

Thanks for flagging this SlideShare!

Oops! An error has occurred.

Destination Central America

  • 501 views
Published

 

Published in Travel , Business
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Be the first to comment
No Downloads

Views

Total Views
501
On SlideShare
0
From Embeds
0
Number of Embeds
1

Actions

Shares
Downloads
28
Comments
0
Likes
1

Embeds 0

No embeds

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
    No notes for slide

Transcript

  • 1. Destination Central America: Latin America’s Newest Emerging Market International Trade Association of Greater Chicago March 9, 2005
  • 2. Topics
    • Central America at a Glance
    • Why Export to Central America?
    • Central America --Then and Now
    • Central America -- Trade Data
    • The “CA-5”
    • Challenges / Opportunities
    • On the Horizon / CAFTA-DR
    • Programs / Services in Central America
  • 3. The Region at a Glance
    • 16th Largest Market for U.S. Exports
    • U.S. Exports = $11.4 Billion (2004)
    • Market Larger than India, Russia and Indonesia - combined
  • 4. The Region at a Glance Population (millions) Source: CIA World Factbook
  • 5. The Region at a Glance Gross Domestic Product Source: Secretaria de Integracion Economica Centroamericana (SIECA)
  • 6. Why Export to Central America?
    • Democratic Governments
    • On-going Market Liberalization
    • Growing U.S. Hispanic Population
    • Proximity to U.S.
    • 50% of Region’s Imports are from the U.S.
    • CAFTA-DR and FTAA will Spur Investment, Economic Growth, and Increased Trade
  • 7. Then and Now
    • Banana Republics
    • Civil War
    • Political Unrest
    • Limited Agricultural Economies
    • Economic Instability
  • 8. Then and Now
    • High-Tech Corridors
    • Tourism and Services
    • Development of Non-Traditional Sectors
    • Stable Democracies
    • Sustainable Economies
    • Niche Markets
  • 9. Central America: Trade Data Largest Industry Segments Source: CIA World Factbook
  • 10. Central America: Trade Data
  • 11. Central America: Trade Data Source: Country Commercial Guides from Central America and Economic Office Guatemala
  • 12. Central America: Trade Data 2004 Exports to and Imports from the U.S. Source: U.S. Department of Commerce
  • 13. Central America: A Real Market Source: USDOC/ITA – F.A.S./Customs Basis
  • 14. Illinois’ Exports to CAFTA-DR
    • Exports totaled $211 million 2004
    • 23% increase over 2003
    • Costa Rica largest market for Illinois in region
    • 98% of exports manufactured goods
      • Communications equip
      • Grain & oilseed milling products
      • Motor vehicle parts
      • Electrical equip
      • Plastics
  • 15. The CA-5: Guatemala
    • Largest Economy in Central America
    • Economy Nearly Completely Privatized
    • Tax Collections are about 10% of GDP
    • Tariffs are Relatively Low (1-17%)
    • for Almost All Products;
    • VAT is 12%
  • 16. The CA-5: Honduras
    • Competitive Labor Costs
    • U.S. Accounts for 50% of All Foreign Trade
    • The Maquiladora Industry Accounts for 15% of GDP and 11% of Exports
    • Puerto Cortes is the Largest Port in Central America
    • U.S. has 40% of FDI in Honduras
    • 4 int’l airports
  • 17. The CA-5: El Salvador
    • Smallest Country in Central America. Densely Populated
    • Over 1.5 Million Salvadorans Live in the U.S.
    • Foreign Trade Grew 400% between 1992-2000
    • Aggressive Trade Policy = Rapid Economic Develop.
    • Dollarized economy
  • 18. The CA-5: Nicaragua
    • Safest Country in Central America
    • Price Controls Phased-out
    • Privatization
    • Rich in Natural Resources
    • Lack of Diversity in Sector
    • Development
  • 19. The CA-5: Costa Rica
    • Highly-Educated Workforce
    • Most Politically Stable Country in Region
    • Booming Tourism Industry
    • Privatization Limitations
    • 95% Literacy Rate
    • Small Population but High GDP & FDI
    • Market Openings Expected Under CAFTA-DR
  • 20. Central America is an Open Market
    • Tariffs are Relatively Low (1-17%)
    • VAT Average - 12%
    • Almost No Import Restrictions
    • Standards are Similar to the U.S.
    • Labeling/Testing not a Problem
    • Variety of Qualified Agents and Distributors Available
    • Growing English Use in Business
  • 21. Opportunities: Best Prospect Industries
    • Automotive Parts and Service Equipment
    • Food Processing/Packaging Eq.; Processed Foods
    • Electric Power Generation / Distribution Equipment
    • Hotel and Restaurant Equipment
    • Franchising
    • Security and Safety Equipment and Services
    • Telecommunications
    • Construction Equipment
  • 22. Challenges
    • Financial Reform
    • Respect for Contracts
    • Investment Protection
    • Judicial Reform
    • Export Promotion
    • Corruption
    • Education
    • IPR Protection
    • Security
    • Start-ups; SMEs; Entrepreneurship; Leadership
  • 23. Central America: On the Horizon
    • Maquila Sector will take a hit in 2005. China.
    • Central America 100% Dependent on Imported Oil
    • Increased Overseas Remittances
    • El Salvador - $2.5 bil, Guatemala - $2.5 bil, Honduras - $1.2 bil, Nicaragua - $519 mil
    • CAFTA-DR
  • 24. CAFTA-DR: U.S. Benefits
    • Comprehensive reciprocal Trade Agreement; not unilateral like CBI/CBTPA
    • More than 80% of U.S. manufactured exports duty free immediately; remaining over 10 years
    • Market access to services market such as telecom & insurance
    • Better business and investment climate—transparency, procurement, investment protection
  • 25. CAFTA-DR: Regional Benefits
    • Better Access to Central American Market
      • Improved Movement of Goods within CA-5; Customs
    • Larger Availability and Quality
    • of Products for Consumers
    • Enforcement of Labor Rights
    • Protection of Environment
    • Better Investment Climate
  • 26. CAFTA-DR: What’s Happening?
    • U.S. firms have regionalized operations
      • Proctor & Gamble, Abbott
    • CA firms are regionalizing
      • La Fragua, Roble, Banco Cuscatlan
    • Regionalization: Power grid; Customs; Highway integration
    • Negotiating as a group
  • 27. CAFTA-DR: What’s Happening?
    • Ratified by El Salvador and Honduras; other CAFTA countries next few months
    • Implementing legislation to Congress within a month
    • Vote in Congress likely before summer
    • Lightening rod for opponents of free trade
  • 28. CAFTA-DR: Factoids
    • CAFTA will open Central America to the U.S.
      • The U.S. is already open to CAFTA
    • Textiles: 2 nd largest market for U.S. textile fabrics and yarns.
      • T-shirt made in CA 60-70% US. Content. China <10%
    • Sugar: Increased quotas
      • Equal slightly more than one day’s U.S. production
    • Labor and Environment
      • CAFTA keeps up the pressure for reform
    • CAFTA supports freedom, democracy and economic reform in our neighborhood
  • 29. A Sampling of our Services in Central America
    • In-Depth Counseling of U.S. Firms
    • Gold Key Service
    • International Buyer Programs
    • Platinum Key Service
    • Customized Market Research
    • International Sector Analyses / Market Insights
    • Contact Lists
    • Advocacy
    • International Company Profiles
    • International Partner Searches
    • Country Commercial Guide
  • 30. CS San Jose CS Guatemala CS Honduras Commerce Nicaragua Commerce El Salvador
  • 31. CS Central America Regional Industry Sectors
    • Apparel, Textiles & Equip
    • Automotive Parts and Service Equip
    • Computers & Software
    • Construction Equip & Services
    • Food Processing & Packaging
    • Franchising
    • Hotel & Restaurant Equip
    • Medical Equip & Pharmaceuticals
    • Telecom Equip & Services
  • 32. CS Central America: On the Horizon
    • International Franchise Expo, Washington DC Apr 2005
    • Waste Expo, Las Vegas May 2005
    • Nat’l Restaurant Hotel Motel Show, Chicago May 2005
    • SUPERCOM, Chicago Jun 2005
    • Clinical Laboratory Exposition, Orlando Jul 2005
    • MAGIC, Las Vegas Aug 2005
    • Pack Expo, Las Vegas Sep 2005
    EVENTS
  • 33.  
  • 34. Other Useful Contact Information
    • Office of the United States Trade Representative
    • Website: www.ustr. gov
    • • Business Coalition for U.S.-Central America Trade
    • Website: www.uscafta.org
    • • U.S. Commercial Service in Central America
    • Website: www.buyusa.gov/centralamerica/en
    • • Trade Compliance Center, U.S. Dept. of Commerce
    • Website: www.tcc.mac.doc. gov
    • • USDOC CAFTA Website
    • Website: www.ita.doc.gov/ cafta
  • 35. IMPRESSIONS/ CONCLUSIONS
    • 50% of Region’s Imports Come from the U.S.
    • Region in General is Peaceful, Democratic
    • Trying to Find a Foothold in the Global Economy
    • Markets are Close to the U.S.
    • Regional Integration and CAFTA-DR will spur more Investment, Economic Growth, and Trade
    • Markets are Growing