BOLIVIA: SOY PRODUCERS, FEARING MARKET LOSS IN COLOMBIA AND PERU, PRESSURE GOVERNMENT FOR DEAL WITH U.S.
Bolivian exporters and opposition figures have begun pressuring the government of President Evo Morales to set up a free-trade agreement (FTA) with the US, a negotiation that Morales says he will never join. Bolivian soy producers fear that they have lost out massively on the export market to key purchasers Colombia and Peru after the two countries signed the Andean Free Trade Agreement (AFTA) with the US in recent months (see NotiSur, 2006-01-13 and 2006-03-10). The treaty increases Colombia's and Peru's access to cheap, highly subsidized soybeans from the US, meaning that their purchases of Bolivian soy products are likely to drop drastically.
The opening of US market access to Peru and Colombia has put pressure on industries in smaller economic powers like Ecuador and Bolivia, although broad popular opposition in those nations would play a greater role in blocking agreements (see NotiSur, 2006-03-24). Bolivia has been participating in US trade talks in an "observer" status and could conceivably commence bilateral talks with the US, but Morales' declarations and rising tensions between his and US President George W. Bush's administrations make that improbable.
Bolivian soy industry to lose access, competitiveness
Because the US is a large-scale soy producer and it just finished talks to remove most trade barriers with Colombia and Peru, the Bolivian soy market, an industry that employs some 120,000 Bolivians, finds itself at serious risk. Beginning next year, Bolivian soy products could be displaced by US soy, and producers fear that they could lose 40% of their export market on soy and soy derivatives like soy flour, grain, and "torta de soya", or milled soy with the oils removed, used for poultry feed.
Venezuela and Colombia are two of Bolivia's top soy-product purchasers, with Venezuela purchasing almost 700 million kg last year and Colombia buying over 530 million kg. Peru is the third-largest buyer of Bolivian soy, purchasing 175 million kg of soy products. Reuters reports that Colombia accounted for US$170 million dollars in sales out of Bolivia's total Andean sales of US$400 million in 2005. This made soy production a major portion of Bolivia's total volume of export sales, which the government estimated at between US$2 billion and US$2.5 billion last year.
But Colombia has conceded a quota allowing the import of more than 800 million kg of soy from the US in AFTA, about 400 million kg more than Bolivia was able to sell to its...
Para continuar leyendo
Solicita tu pruebaCOPYRIGHT GALE, Cengage Learning. All rights reserved.
