SEMINAR PRESENTATION A-Z Information Ltd October 25. 2012

1. BDC Development of Sustainable Exports to the European Union under the EPA FEEDBACK FROM FACT FINDING MISSION TO THE FCORs August 26-Sept 6, 2012 SEMINAR PRESENTATION A-Z Information Ltd October 25. 2012

2. Outline of the Presentation • Brief overview of the project; mission objectives and methodology • An overview of the FCOR markets – economic background, growth statistics, manufacturing and tourism base, major exports and imports and trade partners • Exporting to the FCOR • Opportunities available to do business with Trinidad – price structure, shipping arrangements, feedback on the ground in terms of TT products, areas for collaboration • Data analysis and information assessment

3. Project overview, Mission Objectives and Methodology

4. Project overview, Mission objectives and Methodology • The project to develop sustainable exports to the EU aims to assist exporters from Trinidad and Tobago to explore trade opportunities in the French Caribbean Overseas Region (FCORs). • Overall objectives • To improve the capacity of participating Trinidad and Tobago businesses to penetrate the markets of FCORs by improving their understanding of the requirements and business culture of the markets of the FCORs and; • To build the capacity of BDC staff to support future Trade penetration efforts

5. Project overview, Mission objectives and Methodology (cont ..) • The central purpose of the project is to assist Trinidad and Tobago exporters in addressing constraints to penetrating the FCOR markets and expanding exports and involves • Increasing exporters and BDC’s knowledge of how to navigate these territories with respect to regulations, restrictions, quality, labeling and packaging standards, institutional arrangements, cultural nuisances etc. through a combination of internal market research, market visits, matchmaking and other business promotion activities. • Undertakingmarket penetration efforts • Supporting participating companies in addressing constraints to penetrating the French Antilles • The project will also assist BDC to disseminate the lessons learnt under the project and will through transfer of knowledge from the consultant, build BDC’S capacity to support the private sector beyond the life of the project.

6. Project overview, Mission objectives and Methodology (cont….) • The companies and the products to be promoted come from the non-energy sectors of Trinidad. • The preliminary selection identified • Furniture • Confectionery • Cosmetics • Food and Beverage • Printing and Packaging • Leisure Marine • Plastic products • Safety products Construction • Household consumer products

7. Project overview, Mission objectives and Methodology (cont...) Mission Objectives • To gather information on the FCOR markets, specific to the need of the targeted exporters in the non-energy sector of Trinidad and Tobago such that competent advice can be provided relative to the development of export plans for the companies involved. • To engender a firmer understanding of the market characteristics of the FCOR and to lay the foundation for subsequent trade and market penetration missions • To make contacts, identify potential outlets for TT products and to formulate ideas and solicit support for the impending trade mission

8. Project overview, Mission objectives and Methodology contd. Key information gathered • Major suppliers to the market • Main Brands in the market/ nature of the competition • Prices • Distribution structure • Packaging • Regulatory framework and regulations • List of importers • List of local Manufacturers; Agents and Distributors • Detailed outline of applicable taxes(Octroi de Mer and Quay tax

9. Project overview, Mission objectives and Methodology (cont...) Methodology • Itinerary for visits to key agencies and markets developed for each territory courtesy of the Chambers of Commerce • Additional visits to markets and production/distribution entities where possible • Data capture on prices and brands • Key observations regarding market characteristics • Daily wrap up meetings to discuss findings, review key observations and identify gaps in the information gathered. • Develop product briefs • Convene workshop in TT to present information to exporters • Countries visited • Martinique (August 26-29) • Guadeloupe (August 29-August 31) • French Guyana (Sept. 1-6).

10. Geographic Location

11. Population, Size/land area GUADELOUPE Land Area: 629 sq. Mi Population (2011 est): 503, 274 persons FRENCH GUIANA Land Area: 32,253 sq. Mi Population (2011 est): 274,652 persons MARTINIQUE Land Area: 436 sq. Mi Population (2011 est): 498,151 persons

12. FCORsDemographic Projections

13. GDP (2009, € Billions)

14. GDP Per Capita 2006-2009 (€ per capita) TT figures converted from US$ to € with Exchange rate of € 1 =US$1.25

15. Transportation Options (Shipping and Air) between Trinidad & Tobago and each FCOR

16. Main Exports, Industries, Minimum Wage

17. CMA CGM Shipping Route between the Guianas, Trinidad and the French Caribbean French Guiana

18. Trade Between TT and FCORs • There is a history of trade between Trinidad & Tobago and FCORs • Trinidad & Tobago dominates CARIFORUM exports to the FCORs due mainly to mineral product related products • Trinidad & Tobago exports several other products to FCORs apart from mineral products • Foodstuffs • Chemicals & Allied Industries • Plastics/Rubbers • Wood & Wood Products • Textiles • Metals Exports • Trinidad & Tobago imports relatively little from the FCORs See following slides for more details

19. Trinidad & Tobago Share in CARIFORUM Exports to the FCORs (2006-2008) in US$ Source: CARICOM Secretariat Statistics, French Customs, DR Customs

20. Exports from CARIFORUM to FCORs by Category (2006-2008) (in US$) Source: CARICOM Secretariat Statistics, French Customs, DR Customs

21. Overall Imports from FCORs by selected CARIFORUM countries (2006-2008, US$) Source: Martinique, Guadeloupe and French Guiana Customs

22. Overview of FCOR marketsMartinique • Balance of Payments 2006 • Exports: US$ 818 million • Imports: US$3,483 million • Composition of GDP • Agriculture: 6%; • Industry: 15% • Services: 72% • Inflation Rate 2005: 2.4 %. • Unemployment rate: 25.2% (June 2005)

23. Overview of FCOR marketsMartinique • Large trade deficit driven by imports from France • Heavy dependency on Metropolitan France and the European Union for financial support and specialisation in few sectors which suggests the need for diversification • Per capita income is the highest among the French Overseas Departments (DOMs) • The country has a demand economy which is somewhat propelled by household consumption • The economy is fast becoming service-based • Tourism - the leading foreign exchange earner • Economy is supported by agriculture (bananas, sugar cane pineapples, root crops vegetables etc. ).

24. Overview of FCOR marketsMartinique • Economic diversification started in 1970 to include • Food production • Bread, pastries; processed meat and fish, sausages (including pork, chicken, blood pudding), cereal, chocolate, milk products, marinate, cocoa, confectionery, spices • Beverages soft drinks • Rum, beer and other alcoholic beverages • Tissue • Cleaning chemicals (large local industry) • A small cosmetics industry, hair and body products including lotions;

25. Overview of FCOR marketsMartinique • Out bound freight is dominated by export of banana to France – the freight is subsidised on both the in- and out-bound containers • The economy is made up of many small companies. • In 2005, some 17,244 enterprises were registered and it is estimated that some 1 500 business are created annually. • Most of these businesses are in the service sector. • Light industry employed about 13.9 per cent of the population. • It includes food processing, building materials, chemical plants, printing, and petroleum refining. • The agro-food sector is the largest • Includes sugar and rum production as well as fruit and vegetable processing

26. Overview of FCOR marketsMartinique • Other Key local industries are; renewable energy including solar; construction; furniture, chemicals and water. • Martinique is more competitive in services including waste management, environmental management etc. • Imports comprised • 60% manufactured goods • 21% energy generating products • 15% of agro- processed products • 1.7% agricultural produce (2006 Data) • Exports comprised • Refined oil (60%) • Banana (14%) • Rum (9%).

27. Overview of FCOR marketsMartinique Special Note • The Chamber of Industry and Commerce and the Manufacturers Association reiterated the fact that Martinique is interested in reciprocal trade • They did not succeed in procuring markets for locally produced products during previous mission to T&T. • There is some skepticism about the EPA although there is recognition of the imperative to develop closer trade and economic relations with the rest of the Caribbean

28. Overview of FCOR marketsGuadeloupe Basic Economic Indicators: • Balance of Payments • Exports:US$147.8 million (f.o.b. 2002 Est.) • Imports: US$1.766 billion (c.i.f. 2002 Est.) • Inflation Rate: 3.2% (2005 Est.). • Unemployment rate: 27.3%

29. Overview of FCOR marketsGuadeloupe • The economy can be described as a service economy with tourism considered the mainstay of the economy • Agriculture is another important industry. • About 42 000 mainly small and medium size companies operate in Guadeloupe. • Most have less then 10 employees. • These companies are mainly in the service sector • There is diversification of industries from rum and sugar with food processing, cement, building materials, boxes, and plastics, as well as ship repair, spring water, renewable energies and new technology being developed.

30. Overview of FCOR marketsGuadeloupe • Spring water is currently sold to markets such as Martinique, St Vincent and Antigua. • Key export Services include renewable energy/clean technology , marketing and advertising among others • Export markets are mainly to • Europe because of the direct lines • Japan • Guyana • St Vincent • Antigua • The country also produces luxury products for export promotion such as liquor, spices, fine confectionery, fashion • Services sectors for promotion include: • Energy • Information technology • Training and education • Architecture and building design among others.

31. Overview of FCOR marketsGuadeloupe • The PORT AND MARITIME ASSOCIATION OF GUADELOUPE (UMPEP) and CIE.BA (Port Community System Data Centre and Services) have developed a solution which can enhance maritime transportation in the region • An Electronic Freight Exchange for Cabotage and Short Sea Shipping in the Caribbean Basin called BECCA, was launched in April 2010 and was further upgraded in June, 2012. • It is a shipping and logistics management tool with a search engine which provides information on the available maritime services for break-bulk cargo or containers – connecting countries within the Caribbean Basin. • The search engine identifies regular liner services classified by country/ports, a directory of ports, operators (shipping lines, agents etc) in a multi-language platform (English, Spanish, French) and soon to be in Portugese’

32. Overview of FCOR marketsGuadeloupe • It will provide information on time, price, space, etc. and will track the goods from estimated time of arrival to delivery to the port. • There are different levels of access – the first level is free, the second has a paid subscription of US$49.00/year • CEI.BA is seeking partners in Jamaica and T&T to promote this service and to commercialise the operation

33. Overview of FCOR marketsFrench Guiana • The economy is tied closely to the larger French economy through subsidies and imports. • Main economic activities • French space center at Kourou (which accounts for 15-20% of GDP) • Fishing and forestry are the most important economic activities. Forest and woodland cover 90% of the country • The large reserves of tropical hardwoods support an expanding sawmill industry that provides sawn logs for export. • Cultivation of crops is limited to the coastal area, where the population is largely concentrated • French Guiana is heavily dependent on imports of food and energy

34. Overview of FCOR marketsFrench Guiana Local industry includes • Seafood (including shrimp; smoked fish) • Food processing (including juice, jams) • Construction (including PVC) • Wood - transformation and certification (75% of the wood is for local consumption – 25% is exported to Martinique/Guadeloupe) • a small portion is used for furniture • Mining (especially gold) • Energy (including solar energy) • Services • Telecommunication technology including tele-medicine • Talks are underway to render the service of tele-medicine to Brazil

35. Overview of FCOR marketsFrench Guiana • Sectors identified for export promotion include • Oil • Rice • Wood • Fish products • Yoghurt • Construction materials and services • Target countries for export promotion • Southern EU and the French territories • Some of the products and services produced for export include • Plastic windows/frames • High technology and engineering • In areas such as botanical, bio medicine, medicine, agronomy, maritime, fisheries research, innovation technology, applied research to adapt products to the local context;

36. Overview of FCOR marketsFrench Guiana • Imports • Food is imported from France • Tropical juices from the Netherlands; • Major source of imports • Mainland France, followed by Martinique and Guadeloupe. • Other suppliers • Miami USA • Panama • China • Trinidad & Tobago for petroleum

37. Overview of FCOR marketsFrench Guiana • Trade Prospects • Developing trade with Miami, USA • Martinique and Guadeloupe has established links with Miami • Trade is increasing with Suriname and is quite small with Brazil • There is growing optimism that the ongoing oil and gas explorations could materialize into a major platform for catalyzing economic growth in the near future • Seeking to develop trade in the region with Suriname and Brazil, given the new highway access to Brazil • The bridge between Brazil and French Guiana was recently completed but is yet to be commissioned • Trade will increase once this link is established. However, it may take some time as areas near to the border in Brazil are underdeveloped; • The Chamber is in the process of developing a trade zone near the port

38. Overview of FCOR marketsFrench Guiana Trade Prospects with TT • The current relation between French Guiana and T&T is focused on energy • Except for petroleum there has not been any special focus on trade with T&T and the rest of the Caribbean • An Energy sector mission from TT will shortly be in French Guiana • There are plans to establish direct flights between Cayenne and Port of Spain as the relationship in the energy sector progresses • There is direct weekly CMA CGM Shipping service from T&T to French Guiana - every 6 days • Another line MARFRET works closely with the CMA CGM • There is apprehension about the EPA and open trade with the Caribbean however there is a gradual movement to foster greater levels of trade in the future.

39. Overview of FCOR marketsFrench Guiana Production and cost constraints • The production capacity of the local companies is small – sometimes they are unable to meet the local demand – far less export. • Brazil and Suriname have not been exporting to French Guiana in any significant way because they largely do not meet the EU standards • Similarly, French Guiana’s production cost is too high to make them competitive in the export market • Most containers return empty to France • FG is not as advanced in trade as the other FCORs. • There is minimal export activity at the port • Key exports - scrap material, wood products and shrimp • 98% of activity is in imports;

40. Overview of FCOR marketsFrench Guiana Major challenge at the port • The depth cannot accommodate large ships • The plan is to expand (depth and width of the channel) to accommodate large ships – 128m long and 28m wide • It is not cost effective to install mobile cranes to discharge cargo • Given the small population (237,200) and limited traffic at the port • Consequently ships using this port must be fitted with its own cranes. • The traffic on the port is a quarter of that experienced in the Martinique port • In 2011 the traffic totalled 2,027 TEUs • 90% of the cargo is handled by CMA CGM which facilitates a direct link between T&T and French Guiana • CMA CGM’s schedule is: Point a Pitre - Fort de France - Port of Spain – Paramaribo – Degrad des Cannes – Georgetown – Paramaribo – Pointe a Pitre.

41. Overview of FCOR marketsFrench Guiana SPECIAL NOTE • French Guiana evaluates a new foreign supplier’s export capacity to determine if they can supply consistently before switching to new suppliers • Trinidad needs to be more responsive to trade enquiries • At times there are no responses • There had been a request to Carib Glassworks of T&T for prices on bottles but there was no response; • A Certificate of Origin was requested of a T&T company for garments imported into French Guiana but there was no feedback from the supplier;

42. Overview of FCOR marketsFrench Guiana Potential Investment in French Guiana • It is easy to establish a business in the market • There is no minimum amount for investment required • Companies only need to comply with the taxation system. • This policy is aimed at increasing employment in the market. • There is no restriction on the type of business which may be opened • The standards however include • The workers will need their safety gear where applicable • The organisation must meet the safety standards • The food processing and wood products sectors are prime areas for investment.

43. Overview of FCOR marketsFrench Guiana Potential Areas for collaboration • Lumber & fish supplies to CARICOM; • Technical assistance in the area of renewable energy; meeting EU standards among others

44. Opportunities available for business between FCOR and Trinidad & Tobago

45. Opportunities available to do business with Trinidad & Tobago Raw materials • All are imported Packaging materials • Identified as a necessary import • Inputs are currently sourced mainly from France, then North EU followed by the wider EU markets because of the required regulatory standards. Beverages • The taste profile is similar to CARICOM Boats • There are two local producers. There is a small market for this product.

46. Opportunities available to do business with Trinidad & Tobago Chemicals • There is a large domestic production of cleaning chemicals • It is advised that a local consultant be engaged to assist in registration as the regulations are quite restrictive • It takes 3-6months to register the products • The packaging and brand name is important

47. Opportunities available for business between FCOR and Trinidad & Tobago

48. Opportunities available to do business with Trinidad & Tobago Bleach • The bleach content is 2.6% • T&Ts specification is 5.25% • There is a strong local brand called La Croix • People are however looking for cheaper varieties • In Martinique it was observed that there was a small package of concentrated bleach 5.5 % available in GEANT supermarket

49. Opportunities available to do business with Trinidad & Tobago Chlorine • In French Guiana it was reported that it is difficult to import chlorine granules into the country which come from France • Due to the small quantities • Specific mode of shipment • The high transit cost where reefers are in use

50. Opportunities available to do business with Trinidad & Tobago • Cosmetics • There is a small local production • Sasha Cosmetics may need assistance to meet the regulatory standards • (See discussions under Guadeloupe below)