Agricultural Policy and Regional Integration in Central America

Dialogue for Agricultural Policies in the Americas

In Light of the Post-2015 Development Agenda

July 20, 2015

Óscar Quesada Madriz

Executive Secretariat of the CAC

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Some Conclusions to begin with...

Political and regional agricultural strategies in Central America and DominicanRepublic are part of a wider process of integration with a systemic vision.

Its design and implementation respond to a medium and long term strategicvision, but it is subject to the directionality of the factors that drive it, so theprogress is not a linear process.

The Central American Agricultural Council (CAC) has established mechanisms tobetter coordinate regional actions with national policies and actions, including aterritorial and intersectoral approach.

The resources provided for regional actions are limited so a prioritizationexercise is necessary.

The contributions and alignment of cooperative efforts with the region are stillvery important to achieve an efficiency of regional development aid.

The outcomes from regional integration in the agricultural sector are visualizedthrough the provision of regional public goods.

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Content

• The Central American Integration System (SICA) as a framework foraction for the agricultural sector

• The factors that influence the design and implementation of regionalpolicies and strategies in the agricultural sector

• Building a medium and long term strategic vision

• Defining priorities and mechanisms for implementation

• Current Agenda

• Outcomes of regional management

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The Central American Integration System (SICA) as a framework for action for the agricultural sector

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Background to the ongoing integration process in the region

• Establishment of the Organization of Central American States in 1951

• General Treaty of Central American Economic Integration in 1960

• Process interrupted by military-political problems in the region

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Central American Integration System (SICA )

• It resulted from the peace process in the Central American region

• It is the current institutional framework of regional integration in Central America and Dominican Republic, established in 1991

Member States

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Fundamental Objective of SICA

"The completion of the integration of Central America, to constitute it as a region of peace, freedom , democracy and development "

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Systems approach of SICA: 5 dimensions for integration

Political

Economic

SocialCultural-

Education

Environmental

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Central American Agricultural Council ( CAC )

The factors that influence the design and implementation of regional policies and strategies in the agricultural sector

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Shared geographical space in a strategic position

Population of over 53.5 million inhabitants (20 million of rural

population)

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5 of the 8 SICA countries in the first 12 locations worldwide11

Abundance and diversity of natural resources but with high vulnerability of the agricultural sector to climate variability and climate change

INDEX OF SEVERITY OF CLIMATE CHANGE IN

CENTRAL AMERICA: to 2020 AND to 2050

FUENTE: Atlas PREVDA 12

Contributionto GDP

Significant importance of the agricultural sector

Food and NutritionSecurity

Employment in rural areas Nicaragua 62.7 %

Honduras 57.3 %

Guatemala 56.8 %

ICEFI

Family Farms

It produces 70 % of food 2.1 million of production units

(CA4 )

49 % of agricultural GDP FAO

Exports (intra-regional and extra-

regional )

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Importance of the agricultural sector in regional and extra-regional exports

0.0 2.0 4.0 6.0 8.0 10.0 12.0

Café y sucedáneos del café

Bananas y plátanos frescos o secos

Circuitos electrónicos integrados

Azúcar de caña o de remolacha

Instrumentos y aparatos de medicina, cirugía,odontología o veterinaria

Dátiles, higos, piñas (ananás), aguacates (paltas),guayabas, mangos y mangostanes

Aceite de palma y sus fracciones

Oro (incluido el oro platinado) en bruto,semielaborado o en polvo

Crustáceos

Carne de animales de la especie bovina

% shares of exports in total exports to third markets of the top 10 products in Central America

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000

2007 2008 2009 2010 2011 2012 2013 2014

Intra-Regional Exports 2007 -2015-million USD-

Productos agropecuarios Resto de productos

Source: SECAC with Information from SIECA 14

Deepening and broadening economic integration

Incorporation of Panama

Progress on the establishment of a Customs

Union

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• Only two products are favored by free trade (non toasted coffee and sugar cane)

• Harmonization of 97.5% of tariff lines

• Roadmap (25/06/2015)• free circulation of goods and trade facilitation• Modernization and convergence of norms• Institutional development

Approval of the Protocol to the General Treaty on Central American Integration and of the Protocol for incorporation of Panama into the Central American economic integration subsystem (April 2013)

Other relevant factors

• Trade openness with extra-regional-strategic partners

• Association Agreement EU - Central America

• Structural changes in international markets

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Países participantes FirmaCentroamérica - República Dominicana 16-abr-98CARICOM - República Dominicana 22-ago-98Centroamérica - Chile 18-oct-99Canadá - Costa Rica 23-abr-01Centroamérica - Panamá 06-mar-02Panamá - Taiwán 21-ago-03CARICOM - Costa Rica 09-mar-04México - Panamá 03-abr-04CAFTA-DR (Centroamérica - Estados Unidos - República Dominicana)

05-ago-04

Guatemala - Taiwán 22-sep-05

Panamá - Singapur 01-mar-06Nicaragua - Taiwán 16-jun-06Chile - Panamá 27-jun-06El Salvador - Taiwán 07-may-07Honduras - Taiwán 07-may-07Estados Unidos - Panamá 28-jun-07Colombia - Triángulo del Norte 09-ago-07Costa Rica - Singapur 06-abr-10Costa Rica - China 08-abr-10Canadá - Panamá 14-may-10Panamá - Perú 25-may-11Costa Rica - Perú 26-may-11Centroamérica - México 22-nov-11Centroamérica - Unión Europea (Acuerdo de Asociación) 29-jun-12AELC - Centroamérica 24-jun-13Canadá - Honduras 05-nov-13

Trade agreements signed with extra-regional partners

Source: SECAC with information from SIECA 17

Building a strategic – medium –and - long term vision

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Strategic vision of the CAC

Central American Agricultural Policy-PACA

• December 2007

• Competitiveness and agribusiness

• Sectoral policy

Regional Agro-Environmental and Health Strategy-ERAS

• May, 2008

• Agro-environmental management

• Inter-sectoral strategy

Central American Strategy for Rural Territorial Development-ECADERT

• June, 2010

• Territorial approach

• Multisectoral strategy

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Considerations for regional actions

• There are differences, both, among countries, and internally in eachcountry

• Some of the most important solutions to the sector's problems must beaddressed with an intersectoral logic

• Regional actions complement national efforts and do not replace them• That regional resources will always be limited in relation to the existing

needs, which implies the need for prioritizing• That there are a significant number ongoing regional actions and that it is

possible to articulate many of them• The implementation of sectoral actions as a whole must contribute to the

achievement of higher goals (food security, rural development, povertyreduction and governance)

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PACA Objective

• Promote a modern, competitive, equitable sustainable CentralAmerican agriculture, articulated regionally, conceived as anexpanded sector, with the capacity to adapt to new roles andopportunities and to promote complementarity between public andprivate actors

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ERAS Objetive

• Sectoral mechanism for promoting agro-environmental management,with emphasis on sustainable land management, biodiversity, climatevariability and climate change, agribusiness, healthy living spaces, sothat it contributes to sustainable human development.

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ECADERT Objective

• Promote participatory social inclusive and equitable management oflocal public policies, with the corresponding processes of consensualformulation of future projects and investment planning processes andguided by a strategic vision, institutional, social, economic, culturaland environmental transformation of the environment Central rural,driven by social and institutional actors of the territories, valuing theircultural identity and their own potential for sustainable development

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Areas of work and crosscutting themesPACA ERAS ECADERT

Areas/Components

Intra and extra regional trade

(agribusiness)

Sustainable management of

land

Institutions for rural

development

Agricultural health and food

Safety

Climate change and climate

variability

social and cooperation

networks

Technology and innovation Biodiversity Economy of territories

Financing Agro-environmental business Cultural and territorial

Identity

Risk management Means of healthy lives Nature and territories

Crosscutting themes

Small entrepreneurial

agriculture

Social Inclusion

Agro-environmental

management

Education and capacity

building

Institutional development Knowledge management24

INTERSECTORIALITY: Attention to commitments and instruments for cross-cutting themes

PCGIR

• Commitments on reductions of natural disaster risks

ERCC

• Commitments on reduction of vulnerabilities, mitigation and adaptation to climate changes

FSN POLICY

• Commitments on food security and nutrition

RISK MANAGEMENT, CC AND FSN INTERLINKED

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Defining priorities and mechanisms for implementation

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Areas prioritized by the Council of Ministers of the CAC (November 30, 2012)

1. Climate change and comprehensive risk management

2. Family Agriculture

3. Territorial rural development

4. Agricultural health and food safety

5. Technology, transferring and innovation (included biotechnology and biosafety)

6. Competitiveness, trade and agribusiness

7. Food Security and nutrition

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CAC TECHNICAL GROUPS

• Identify and manage the implementation of regional-strategic-short-medium-long-term actions within the framework of policies,strategies and presidential-sectoral-cross-regional agreements,according to the guidelines and thematic areas prioritized by theCouncil of Ministers of the CAC and their articulation in each of themember countries. In addition, the Technical Group has the role ofadvising the Council of Ministers on matters relating to strategic areasof competence.

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ACTIONS OF THE TECHNICAL GROUPS • Periodically analyze the current situation of the region in the strategic area of

competence.

• Identify regional actions that: i) add value to national actions and ii) deepen regionalintegration within the framework of regional instruments and mandates of the CAC andthe SICA.

• Define a work program based on the priorities and components established by theCouncil of Ministers

• Establish regional networks that promote knowledge management in their respectivearea and facilitate the exchange of information and technical cooperation betweencountries.

• Issue alerts on themes of particular importance requiring immediate regionalinterventions

• Coordinate and articulate actions with other cross-Technical Groups when thecircumstances so warrant or according with their competencies

• Coordinate regional cooperation of support organizations, prepare and manage regionalproject proposals. 29

Strategic Areas and Technical GroupsStrategic Themes Technical Groups (GT)

1. Climate Change and comprehensive risk management

GT Climate Change and comprehensive risk management

2. Family AgriculturesGT . Territorial rural development(three areas of work)

3. Territorial rural development

4. Food Security and Nutrition

5. Agricultural Health and Food Safety GT Agricultural Health and Food Safety

6. Technology, transferring and innovation (including biotechnology and biosecurity)

GT Research, Technology, Transferring and innovation

7. Competitiveness, trade and agribusiness

GT Competitiveness, trade and agribusiness

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Current Agenda

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Competitiveness, trade and agribusiness

• Trade facilitation and regional economic integration

• Promotion and strengthening of priority agricultural chains with regional focus

• Follow up on regional and international markets (articulating information systems)

• Strengthening of Ministries of agriculture in trade matters

• Regional program to harness opportunities of the European market

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Climate Change and comprehensive risk management• Actions for climate change mitigation (reducing emissions GEF)

• Adaptation measures (increase resilience to climate change)

• Risk management (reduction of risks associated with climatic hazards)

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Territorial Rural Development, family agriculture and food security and nutrition

• Management of public policies and regional, national and territorialinstitutions (Territorial Rural Development and Family Agriculture)

• Promoting inter-sectoral approach to ECADERT under the SICA

• Roadmaps for border territories and related

• Regional and national capacity building program

• Regional actions to promote equity and inclusion (gender, youth,indigenous peoples, Afro-American communities)

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Research, Technology, Transferring and Innovation

• Identification of the state of the art innovations (with their different approaches) and definition of indicators for the region

• Regional strategy for the integration of regional networks for innovation among small producers

• Regional observatory of technologies

• Regional research agenda for innovation

• Exchange of good practices of research management

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Agricultural health and food safety

• Development of legislation in the context of the establishment of the Customs Union

• Regional plan to combat coffee rust and to strengthen the coffee sector

• Regional program of bovine brucellosis

• Constitution of the Technical Group (second half 2015)

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Results from regional integration

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Regional Public Goods

• Existence of regional policies and long-term strategies that give political and technicalsustainability to the actions

• Articulating working mechanisms of field actions regional, national and territorial

• Regional policy frameworks binding for their implementation in member countries

• Coordination and incidence in the design and implementation of policies, plans andstrategies

• Existence of common conceptual and methodological frameworks that articulate thetechnical and institutional approaches in the countries

• Regional platforms for information and knowledge management

• Capacity building both for decision makers and at the technical level

• Forums for dialogue between public sector, civil society and private sector

• Monitor the international agenda of the sector

• Greater ownership, alignment and harmonization of regional international cooperation

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Thank youÓscar Quesada Madrizoscar.quesada@iica.intCoordinador Técnico RegionalSecretaría Ejecutiva del CAC-FESwww.sica.int/cacFacebook: Consejo Agropecuario Centroamericano

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