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Ministry of Food, Agriculture & Livestock. Challenges for Agro-Based Exports (including SPS) Presentation on the Final TRTA even by Aisha Humera, Deputy.

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Presentation on theme: "Ministry of Food, Agriculture & Livestock. Challenges for Agro-Based Exports (including SPS) Presentation on the Final TRTA even by Aisha Humera, Deputy."— Presentation transcript:

1 Ministry of Food, Agriculture & Livestock

2 Challenges for Agro-Based Exports (including SPS) Presentation on the Final TRTA even by Aisha Humera, Deputy Secretary Ministry of Food,Agriculture and Livestock (MINFAL)

3 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

4 Ministry of Food, Agriculture & Livestock Export projections for the year  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

5 Ministry of Food, Agriculture & Livestock 5 Export Comparison Others Chemicals Agri Products Textile & Clothing Engg. Goods Source: WTO Database & FBS World 2003: 7,503 Billion 2003: 11.2 Billion Pakistan Textile Engineering Goods Engineering Goods Textile 2005: 14.4 Billion 2005: 10,159 Billion Growt h % Growth %

6 Ministry of Food, Agriculture & Livestock S # Commodities Value % Share Value% ShareLow ScHigh Sc Core Category 1 Textile & Garments Rice Leather & Leather Products Sports Goods Carpets & Rugs Tapestry Development Categories 8 Fish & Fish Preparations Fruits & Vegetables

7 Ministry of Food, Agriculture & Livestock S #Commodities Value % Share Value % Share Low ScHigh Sc 12 Meat & Meat Preparations Wheat Others (Chem/Petro/Stationery etc.) Total Export GDP Export – GDP Ratio (%)

8 Ministry of Food, Agriculture & Livestock 8 Afghanistan 1.1 / 3.2 UAE 1.3 / 2.6 China 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, Fish Surgical Instruments, Sports Goods, Cutlery, Furniture, M&G,G & J, Rice

9 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

10 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

11 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

12 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.

13 Ministry of Food, Agriculture & Livestock Rice Constraints 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 training Timeline: Immediate Stakeholders be on the research advisory committee Timeline: Immediate Action:MINFAL in collaboration with Provincial Govts.

14 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: MINFAL Timeline: Immediate Incentivize/promote seed processing industry/ business Action : MINFAL Time 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

15 Ministry of Food, Agriculture & Livestock Rice Constraints 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 industries Action: 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

16 Ministry of Food, Agriculture & Livestock Fruits & Vegetables Export Benchmark Targets FY06 FY13 $ Bn

17 Ministry of Food, Agriculture & Livestock Constraints Impeding ExportsAction Plan Lack of quality products for exportTo 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: 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.

18 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 ConsumerConsumer Retailer 8% 3% 20% 2%1% 4% 2%3% 7% Post Harvest Total Loss 10-11% 3 months Total Loss 40% 3 Days With Cool Chain Without Cool Chain

19 Ministry of Food, Agriculture & Livestock Meat &Meat Preparation Export Targets Export Benchmark Target FY 06 FY 013 $ Bn

20 Ministry of Food, Agriculture & Livestock Meat &Meat Preparation Constraints Impeding Exports Action Plan Poor viability of organized livestock farming due to  Low reproductive efficiency of animals  Limited scope of fattening programs  Presence of trade related infectious diseases  Lack 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 housesPublic sector slaughter houses to be privatized and permission to build and operate slaughter houses in private sector be accorded

21 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: years Absence of large livestock farmsModel 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: 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

22 Ministry of Food, Agriculture & Livestock Export target for Fish & Fish Preparations Export bench mark Target FY06 FY13 $b

23 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: years Shrimp aquaculture along creeks and shallow waters near the coast has to be developed. Action: MINFAL/MFD Timeline: years

24 Ministry of Food, Agriculture & Livestock Fish &fish preparations Constraints Impeding ExportsAction 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, 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: 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 & SBP Timeline: 01 year

25 Ministry of Food, Agriculture & Livestock Fish &Fish preparations Constraints Impeding ExportsAction 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: MINFAL Timeline: 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: MINFAL Timeline: 01 year  Establishment of hygienic peeling facilities.  Value added fish processing industry by incentivizing private sector Action: MINFAL & KFHA Timeline: 02 years

26 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 & MOF Timeline: 01 year Provide credit and investment incentives for setting up captive power generation facilities Action: MINFAL and MOF Timeline: years Fisheries Training Center at Karachi be strengthened Action: MFD / Karachi Fish Harbor Timeline: 01 year

27 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: MINFAL Timeline: 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: IPO Timeline: 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: MOC Timeline: years

28 Ministry of Food, Agriculture & Livestock Connect to the Market MARKETSMARKETS PRODUCTS PRODUCTS Products to Market ….by upgrading supply capacities and standards infrastructures Develop Competitive Production Capability Prove Conformity with Market Requirements CompeteConformConnect TRADE CAPACITY BUILDING Approach followed by MinFAL

29 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

30 Ministry of Food, Agriculture & Livestock SPS Diplomacy Technically demanding risk management functions Institutional 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 NAPHIS Effective SPS Management

31 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

32 Ministry of Food, Agriculture & Livestock THANK YOU


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