Ten years ago, the need was identified for an organisation to help the country grapple with the issues of competitiveness in the emerging global trading environment, and so the National Competitiveness Council (NCC), a partnership between government and business, was born. The NCC convenes round-table discussions to co-ordinate efforts to improve the performance of key sectors of the economy.
The NCC proved useful when negotiations for DR-Cafta got under way, with some 80% of its staff playing an active part. Now that the agreement is entering into force, the NCC’s role is to strengthen the capacity of the Dominican Republic to take advantage of the market access it provides. It will also continue to identify where competitiveness constraints exist in bureaucratic and legal systems at home and abroad and, where necessary, help effect change. The aim is to make the NCC a one-stop-shop for communications between different government agencies and business at home and abroad.
One of the NCC’s chief areas of concern is agro-industry. “Agri-business is one of the sectors that can benefit most from DR-Cafta,” says Jesús de los Santos, agro-industrial co-ordinator at the NCC. DR-Cafta will force the Dominican agro-industry to address some issues that the preceding Caribbean Basin Initiative (CBI) did not. For example, under DR-Cafta, sanitary, phyto-sanitary and safety conditions will all need improvement in order to meet international food standards.
The NCC will seek to identify the best means of providing the necessary technical assistance to the agricultural sector in order to comply with this. To accomplish this, agribusiness clusters for technical assistance have been established through the whole of the food production process, from seed to export. DR-Cafta also sweeps away some of the problems surrounding the legal title to land that remained unresolved under CBI, giving landowners more rights.
To do so, it will need to focus on developing certain niche markets, where its competitive advantages are strong. “We need to compete with high value-added products, such as organic products,” says Mr de los Santos. This is the route being taken by the Plantacia del Norte, a cluster of small banana producers in the north-west of the country, and by a similar scheme in the south-west. Elsewhere, other banana growers are pursuing ‘fair trade’ certification.
Taking the niche market concept one step further, the NCC is exploring the possibility of marketing bananas that meet both organic and fair trade standards. “We’re going to do this,” says Mr de los Santos. “We’re in negotiations with British supermarkets such as Sainsbury’s, and a good response has led us to consider doing the same for other high-value fruits, such as mangoes, guava, and passion fruit.”
Besides selling fruit direct to market, the NCC also sees opportunities for adding value by establishing partnerships with manufacturers of fruit drinks, guaranteeing a quality and volume of supply in return for a stable demand. And the NCC has similar schemes under way or in the pipeline to tap into other speciality markets now that DR-Cafta is a done deal. These range from the quality branding of cigars and coffee through to the hot water treatment of mangoes destined for the ethnic minority market in the US, to the promotion of tourism in coffee growing areas.
According to Mr de los Santos, agri-business is also providing some of the best opportunities for foreign direct investment, with a tendency for investors to prefer projects where vegetables are grown under glass, enabling year-round production. “To make this successful,” says Mr de los Santos, “we need to reach a minimum continuous production throughout the year. Some businesses are already in operation here, but not at the requisite supply amount, so there are opportunities for investment.”