Fundación ExportAr Newsletter June

Fundaci贸n ExportAr

June 2011

Chiken Meat union, strategy and success

Ariel Esteban Schale Elvio Baldinelli Automec ProC贸rdoba Financing of exports Standard Bank Foundation In warehouse exporter

Fundaci贸n ExportAr

June 2011

Chiken Meat union, strategy and success

Ariel Esteban Schale Elvio Baldinelli Automec ProC贸rdoba Financing of exports Standard Bank Foundation In warehouse exporter

Argentina s culture for export

FOREWORD

Since 2003, and as a consequence of a new development, production and growth model for the country, Argentina’s exports increased above 130% until 2010 at steady annual rates, except for the year of the world crisis, which have always been over 15% on an annual basis, even reaching 25 % in 2008.

Within this context, and with export amounts surpassing 24.000 billion dollars during the first quarter of the present year, and a growth percentage of 25% for the same period in 2010, our country is about to break a new record in world sales.

In this framework Fundación ExportAr, the Export Promotion Agency of Argentina’s Ministry of Foreign Affairs, International Trade and Worship, following the strategic guidelines set forth by the latter, actively works with Argentine companies in order to help them to successfully trade their products in foreign markets.

To achieve that, it has already been organized the participation of Argentine companies in more than half a thousand international fairs, including traditional markets such as Europe and America, as well as non traditional markets like United Arab Emirates, South Africa, or Ukraine, just to mention a few.

International fairs are one of the most efficient tools designed, since they constitute a privileged spot in which to make contact between exporters and potential clients. National companies from a variety of sectors including food and beverages, agricultural machinery, cosmetics, IT services, hospital equipment, and music, among others, have already participated in these activities.

At the same time, hundreds of Argentine and foreign companies have met at Business Rounds, which are promotion activities designed to invite potential buyers of Argentine exports to come to our country, under carefully organized meetings schedules, to have the opportunity to contact local companies willing to satisfy their demand.

This tool, especially designed for SMEs, has enabled companies from the publishing, dairy, construction, designer clothes, and audiovisual services sector, among other industries, to access the variety of advantages this new promotion tool offers.

The export groups program, which brings together manufactures of complementary products or product lines to boost a more dynamic insertion of products into international markets by increasing the potential of the offer and cost reduction within the export process, is jointly coordinated by Fundación ExportAr and Standard Bank Foundation and was designed

to facilitate the access for SMEs into foreign markets. Also it constitutes one of the more dynamic tools so far this year. Export groups are made up of 424 companies, and 8 more new groups have already been formed in 2011, and by the end of the year there will be 30 further new groups in addition to the 65 existing groups.

Sustainability of any export policy demands the design of a culture of international trade based on a profound and wide knowledge of the activity, among other pillars. In this respect, training activities carried out by Fundación ExportAr outstand.

Many seminars have already been carried out throughout the country, and this tries to constitute a cornerstone in the development of an aggressive export initiative.

Fundación ExportAr implements promotion strategies mutually agreed between provincial and municipal export promotion agencies and organizations, as well as leading chambers and institutions of the country, to become privileged partners within a federal framework when it comes to bringing Argentine products to the world.

The proper coordination between the different export promotion actors of our country, by the dissemination of trade information, actions coordination, and product positioning around the world is a direct benefit for national companies.

Our mission is to add value to the Argentine exporter; our commitment is to provide high quality support services that help to boost the image and competitive development of Argentine companies; our goal is to monitor the growing export process along with more Argentine export companies into more international markets with more exported products and services.

Juan Usandivaras

CONTENTS

Fundación ExportAr Newsletter

June 2011

4 Carne Aviar: a strategy that introduced

Argentine chicken to the world

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STAFF

The numbers behind the phenomenon

10 Tres Arroyos, a model company

Administrative Board - President Lic. Miguel Acevedo Administrative Board -Secretary of International Trade and Economic Relations Amb. Luis María Kreckler Undersecretary of Internacional Trade Amb. Ariel Esteban Schale

12 Argentine AutopartS show off in an out-

standing pavilion

Executive Director Lic. Juan Usandivaras Manager Dr. Héctor Lorenzo Editorial and contents Lic. Nilda Bordón Lic. Verónica Scornik Lic. Javier González Ojeda Design DG. Pablo Caruso DG. Sebastián Feinsilber DG. Daniel Higa DG. Omar Baldo

13 Interview Juan Cantarella, AFAC 14 Interview Juan Cañellas, OMER

tipography: Bree, © Type together

15 Automec, the market and the sector 16 Interview Diego Turco, Grupo Unesa 18 Resounding success of the Trade Mission

to Mexico

Ministerio de

Relaciones Exteriores, Comercio Internacional y Culto

w w w . e x p o r t a r . o r g . a r Complete or partial reproduction of the content and photographs herein is permitted by mentioning the source: News, Fundación ExportAr Newsletter.

22 Business opportunities in Mexico 24 We strengethened our relationship with the

Argenitne-Arab Chamber

25 Innovative agreement with the Standard

Bank Foundation

26 Results of the economic development model

in internacional trade: exports keep growing and break a new historic high.

Amb. Ariel Esteban Schale

27 ExportAr is a great place to work 28 Interview Elvio Baldinelli 32 Interview Oscar Guardianelli, Agencia

ProCórdoba

34 A great opportunity for our companies

77 77 78 79 79 79 80

36 New regulations for in warehouse

exporters

37 Interview Gustavo Mingone, Regional

Customs Directorate of Córdoba

39 Seminar: ExportAr support services in Chaco 41 DOSSIER Financing of exports 57 Special Report Entre Ríos part 2

Fairs LAAD 2011 LATIN AMERICA AERO & DEFENSE 2011 FANCY FOOD 2011 Rounds 3rd International Business Round of Machinery and Related Tools. EMAQH 2011 2nd International Business Round of Food and Food Technology- FIAR 2011 3rd International Business Round of Books 2011 4th International Business Round of Security Products and Services 2011 International Business Round of Food 2011

80 81

Missions Trade Mission MIPTV 2011 Colombia Fashion Medellín 2011

81 82

Training Seminar “Horse export” Seminar “First steps in exporting”

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Calendars Fairs Rounds Missions Training

A Success Story: Roberto Domenech, president of CEPA

Chicken meat: a strategy that introduced Argentine chicken to the world The systematic work of the Centre for Poultry Processing Companies (CEPA) is a key factor in explaining the rapid growth of chicken meat exports in recent years.

The Centre’s Strategic Plan meant that between 2003 and 2010 the sector was able to boost production by over 50%. Roberto Domenech, president of CEPA, discusses the importance of this scaled production plan that gave the Argentine poultry sector its competitive export profile.

A fully committed entrepreneur Roberto Domenech, current president of CEPA

(Centre for Poultry Processing Companies) first became involved in industrial poultry farming in Argentina in 1963. He was one of the creators of the integration process in poultry farming, which began in Argentina in 1976, and since 1983 he has played an active role in company union activities. He is Vice-president of COPAL (Coordinating Committee of Food Products Industries) and sits on the Board of Directors of the Argentine Industrial Union (Unión Industrial Argentina, UIA). He is also Vicepresident of ALA (Latin American Poultry Farming Association). He was Undersecretary of Agricultural Policies and Foods of the National Secretariat of Agriculture, Livestock, Fisheries and Foods. He gives talks, conferences and presents projects in different government, legislative and sector forums in the country and around Latin America.

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How do you explain the wide range of markets for Argentine chicken today? What pattern did this growth take?

Our strongest growth came after 2004. Markets had been opening very slowly but then, and coinciding with the Development Programme (2003-2010) we had launched with an annual growth rate estimated at 10%, something unforeseen happened: bird flu appeared in Thailand. At that time, Thailand was the second largest world exporter of chickens with 800,000 tonnes, so this presented us with a great opportunity.

Most of Thailand’s buyers looked to the largest supplier, Brazil, which could only partly satisfy demand. We had done several campaigns to show that Argentina also produced chicken, and a large number of clients appeared. So we suddenly had over 40 markets open to us, which made us an important player in the world. Operators are basically the same everywhere; they know each other and are in regular contact.

Today we have 66 markets (market being a destination to which a minimum of four shipments are made a year), and we sell to five continents. We supply whole chicken (all parts of the bird), and flours made from processing the offal, the feathers and the blood.

less costly for the producer with better quality. The packaging has improved, presentation too, and producers have begun to charge more. Although quality means complying with a series of product requirements, quality has to do with what the client is willing to pay.

How has chicken from Argentina had to adapt to capture different markets? What technological changes have accompanied the process?

The Middle East, the largest market in the world, demands a bird weighing from 700 to 1200 grams, and also whiter meat.

So the idea is to adapt the technology to be able to produce two different types of chicken: on the one hand, the chicken demanded by the eastern market and on the other, the product consumed in our domestic market.

Chicken relies on good genetics, healthy conditions, good feed and good handling. Those four variables are constantly being reviewed or improved. The only thing that is imported is genetics. There are five lines in the whole world which are a combination of original breeds. They are hybrid chickens, since from each breed the characteristics are taken that are to be reproduced in the final product. The mixture of different aptitudes or characteristics results in a capacity for development that no particular bird has naturally.

Any country which trades internationally must be free of these diseases. Reporting of both diseases is compulsory and export markets close until the problem is solved, except for cooked meat, which is a developing market. Thailand, for instance, is still barred from exporting fresh chicken to countries that are free of bird flu.

In terms of food we no longer work only with soya bean and maize combinations, which make up 90% of the formula -63% maize and 27% soya complex- but what we do is work on the level of granulometry (to what extent the maize or the soya are ground, to what extent I make compressed feed and grind it again). We do this because now a chicken is ready for slaughter much earlier, so it eats much more when small and produces more. Nowadays science and engineering are very important in designing the equipment used.

Was the strong growth in chicken meat exports circumstantial or have there been changes in trade policies?

Do you think that the world trend to healthy living means that people are eating more chicken rather than red meats?

How do bird flu and Newcastle disease affect the international trade in chicken meat?

When we launched the Strategic Plan in 2003, we were producing 740,000 tonnes. In 2010, we concluded the cycle with 1,750,000 tonnes. We foresee annual growth for the second stage (2011-2017) of 6%.

To implement any project connected with poultry farming it is essential to be competitive. Argentina has characteristics that allow it to make a very safe and very healthy product, a harmless product: it has good availability of primary raw material, such as maize and soya, and a good climate. The highest cost in exporting stems from the distance to the largest consumer markets. However, when the country abandoned the convertibility plan, we began to work on scale and on capturing markets. Our costs were tremendously distorted which made it impossible to sell abroad. Whatever we wanted to sell was expensive, while imports were cheap. On exiting the convertibility plan we became profitable and everything fell into place. From then on we were presented with a series of opportunities that brought scale to our production. In seven years we more than doubled production because that scale made us more competitive.

Over the period the equipment used in slaughterhouses underwent great changes. The plants that used to kill between 5 or 6 thousand chickens per hour, today kill 12 thousand an hour. There is more mechanization and chicken has become

I think so. Chicken is well received by the consumer. It has a series of very big advantages: its temperature range: it can be eaten fresh off the grill or cold; it has no religious restrictions and is highly digestible. We’re convinced that the positive attitudes of customers, the product and its price in domestic and international markets are contributing to growth in production.

The private and public sectors are working together on opening new markets for national poultry products. What projections do you have for South Korea and India, for instance?

South Korea is a potential market with which Argentina is on good terms today, because it is supporting, training people and transmitting experience, especially on the subject of foot and mouth disease.

Meanwhile, we have spent the last two years working to open the market for red and white meats. Korea is a very demanding country in this regard and there are a series of nine steps to be taken, and we’re in the process of completing number six.

As regards India we are dealing with two issues: on one hand, market research. We’re familiarising ourselves with the country, although we realise that most of the population are vegetarian.

On the other hand, Argentina and the MERCOSUR are working News

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on starting a Free Trade Agreement, analysing the possibility of obtaining the sanitary certificate at least. However, India has tariffs which make exporting prohibitive. Brazil is also working on this and is providing us with relevant information.

Unfortunately, there are many snags to this market so although we can’t afford to ignore it, our energies are focusing on markets where we have better access.

Let’s say that both are possible markets but there are many points to consider.

CEPA has 40 associated companies, what are their goals for 2012?

Their goals are in line with the Strategic Plan. Unfortunately, in this first quarter we haven’t received the expected response in the international market because of falling demand from Europe. It’s a deciding factor in terms of cutting the chicken because it’s vital for us to sell the breast first and only then the rest of the bird.

We need to watch very carefully the progress of negotiations on the Free Trade Agreement between Europe and Mercosur.

It would be important for us in time to gain a space in this market because Europe is the largest consumer of breast. By selling breast in Europe you can then sell deboned chicken leg and thigh in Japan, for example, and then the wings.

During Argentina’s Bicentenary we received further financial assistance with the loans received, which covered all our investment requirements for 2011. Besides, between the second half of this year and the first of next we’re going to equip at least three plants to “adapt” chicken to the needs of the Middle East (from 700 to 1200 grs). That opens up a very great horizon.

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News

The numbers behind the phenomenon Asian imports of poultry meat, pieces and waste products move over 3 million tonnes, a year representing, on average, 40% of the world market. In 2009 imports totalled 4.918 billion dollars.*

Source: Own data based on COMTRADE figures

The largest importer of chicken meat, pieces and by-products is China together with Hong Kong, followed by Saudi Arabia and Japan.

Source: Own data based on COMTRADE figures *This analysis does not include Russian imports within Asian imports, since although a large part of the country lies within that continent, its main urban centres are in Europe and there are insufficient statistics to discriminate consumption in European Russia from that in Asian Russia.

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Globally, Asia’s main supplier is Brazil, covering on average 52% of imports.

It is followed in importance as supplier by the United States, with an average 28% share for the period 2005-2009. Argentina’s largest market share was obtained in 2008 with 6.5%, but taking the period as a whole average share was 3.7%.

Source: Own data based on COMTRADE figures

In Argentina in particular, we can see that exports of chicken meat have grown steadily over recent years. In the period 2005-2010, exports rose 243% in value and 124% in volume. This increase in tonnes sold abroad has been maintained with an annual increase in exports of around 14%.

Source: Own data based on COMTRADE figures

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The sale of Argentine poultry products to Asia accounts for a third of our total sales.

The principal countries to which Argentina regularly exports poultry products are: China, Hong Kong, Vietnam, Saudi Arabia, Singapore, Philippines, Iraq, United Arab Emirates and Kuwait.

The leading product sold is fresh meat. This classification covers sales of whole chicken as well as its various parts. The leading countries that buy this kind of products from Argentina are Saudi Arabia, Singapore, Iraq, United Arab Emirates and Kuwait. Orders from these countries are mostly based on the sale of whole chicken, of a smaller size than usual in Argentina, and with Halal certification**.

Sales to both China and Hong Kong are of poultry by-products, mainly the feet (29,828 tn and 9,608 tn exported in 2010 for China and Hong Kong respectively) and to a lesser extent, chicken wings (9,280 tn for China and 493 tn for HK).

Although, as mentioned above, sales to Singapore mainly comprise fresh meat, sales of chicken wings are considerable (988 tonnes in 2010).

Exports to Vietnam and Philippines are principally of animal flours.

Besides the current destinations and promotional activities designed to secure greater presence of the Argentine product on Asian supermarket shelves, joint work is now being done between the private sector and the public sector to open new markets for national poultry products.

This is the case of South Korea, where talks are at an advanced stage and a request is being made to India to open its market.

Today we export poultry meat to 66 countries.

Germany Angola Netherlands Antilles Saudi Arabia Aruba Bahrain Belgium Benin Brazil Cape Verde Chile China Cyprus Congo Cuba Egypt United Arab Emirates

Spain France Gabon Gambia Georgia Ghana Grece Guadeloupe Guinea Equatorial Guinea Netherlands Hong Kong Ireland Comoros Islands Mayotte Reunion Italy

Japan Kenia Kuwait Liberia Lituania Martinica Mauritania Mexico Namibia New Caledonia New Guinea Oman Pakistan Peru French Polynesia Poland Portugal

Qatar United Kingdom Czech Republic Russia Serbia Singapore South Africa Sweden Switzerland Togo Turkey Uruguay Venezuela Vietnam Yemen

** Halal Certification is the tool with which the Halal Institute guarantees that products and services for Muslims comply with the demands of Islamic law and are therefore fit for consumption, both in Spain, the EU and the countries of Muslim majority.

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A success story

Tres Arroyos, a model company One of the most booming companies in the poultry sector is Granja Tres Arroyos S.A. It has over 7 decades of history in the market and it shows its desire to continue conquering international markets day after day. The adventure started in 1935, when Gaspar De Grazia arrived in Argentina with the hope of prospering and with an unshakeable pioneering soul. As all beginnings, it was a hard one, but Gaspar never grumbled about this and laid the foundations of what today is a leading, strong exporting company. Did Mr. Gaspar imagine, when going around the streets of Buenos Aires selling chicken, that one day his company would be selling to countries from Asia, Africa and the European Union? We don’t know, but that’s the reality today, Fiorella De Grazzia, Gaspar’s granddaughter and director of the International Division of the firm, told us proudly. The company today has the collaboration of over 3,500 people hired directly, “making up the best prepared team to do poultry farming in Argentina”. Fiorella has obtained her undergraduate International trade degree and her MBA from Universidad Torcuato di Tella. Her father, Joaquín, is the CEO of the company.

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When did you start exporting?

The first export of frozen chicken was made in 1978, in a bulk carrier to the Middle East, but then the exports were put off until 1994. Precisely as of that year, the company started selling chicken feet in Hong Kong and timidly some containers with chicken breasts to Europe. In 1995 we exported only to 5 destinations and today there are almost 70 countries importing our products.

How was the path to conquer international markets?

Tres Arroyos has taken an active part in many food fairs since the 90s, both national as well as international, and in many of them, especially in the last few years, with the cooperation of Fundación ExportAr. The fairs have allowed us to get in contact and form a relationship with buyers from all around the globe. That was the beginning, but we’ve also been involved in business rounds and trade missions. These experiences are very useful to cultivate the loyalty of foreign customers and to develop new markets.

also in the negotiation of import quota of Argentine poultry, among others.

You mentioned earlier that you have worked with Fundación ExportAr. How was the experience?

Every time we’ve worked with Fundación ExportAr we’ve had excellent experiences. The effort of the staff participating actively in the previous organization and during the fair is ideal. Thanks to this contribution, we’ve had the chance to attend the most remote fairs that allow us to reach different market niches.

What are the company goals for 2011?

Last January we inaugurated a new slaughter plant in Pilar, Province of Buenos Aires and we are about to finish installing machinery to inaugurate another plant in Entre Ríos dedicated to egg incubation. The objective is to keep growing and supply both the domestic and external markets with best-quality products.

Do you currently take an active part in International Fairs? What do you think of them as a tool to conquer new markets?

Yes, we are very active in this type of events; we mainly go to Anuga, Sial, and Gulf Food Dubai, among others. They represent an essential tool to capture new customers and develop new markets. They are also important since they mean an annual encounter with our current customers.

To what do you attribute the growth of poultry meat exports?

The growth started after 2002, when Argentina began being competitive in the poultry production, mainly as a result of the new exchange rate. At the same time, there was a great increase in meat consumption in emerging countries such as China and many African countries. When the economy of these countries improved, the first consumption where growth was observed was that of poultry meat, since it was the most affordable one and does not have religious barriers.

Many African countries practice the Muslim religion, which does not allow the consumption of pork, for instance.

What are the main destinations of your exports?

Countries of the Middle East are great consumers of poultry, after that comes the European Union, as a bloc.

We hear a lot about the potential of the Asian market. What is your opinion?

From our company, we see that Asian countries such as China, Singapore and Japan are increasing their purchase volume and demand more and more production. We’ve been exporting chicken feet to China for many years, but now we see that they also have a need to consume more valuable products.

What obstacles do you encounter today to increase your exports?

It would be necessary to improve the port infrastructure, with more ports in the interior of the country able to handle refrigerated cargo with enough draft for the entrance of container ships. Also, from CEPA (Center for Poultry Processing Companies), our chamber, we are making great efforts, together with official bodies in order to open new markets in destinations that today are closed for different reasons, and News

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Automec 2011

Argentine autoparts show off in an outstanding pavilion Sao Paulo, Brasil 12 - 16 April Autoparts, equipments and services

The International Trade Fair of Autoparts, Equipments and Services was held in the traditional Parque Anhembi of Sao Paulo.

Since the autoparts industry grew at the same time the automobile industry did, the organizer of this event decided to invest in an exclusive fair for this market, so that is how AUTOMEC emerged from the International Automobile Show and reached its 10th edition, showing all the power and strength of the automobile industry. Organized every two years, AUTOMEC keeps registering high volumes of business transactions, becoming the main window shell of the industry in Latin America.

The first AUTOMEC edition was held in November 1993, at the Exposition Pavilion of Anhembi. In that occasion, the Fair gathered 401 exhibitors, out of which 120 were foreign and hosted 53,000 visitors/ buyers from 48 countries.

In the previous edition, in 2099, it gathered 968 exhibitors -542 nationals and 426 foreigners-. It hosted 62,314 visitors/ buyers, and thirty countries were represented, among which the pavilions of Argentina, France, Uruguay, Spain, China, Italy, Singapore and Taiwan were outstanding.

Throughout years, this fair helps the development and growth of the automobile industry and has become, beyond doubt, the main fair of the autoparts industry. The evolution of this industry in the past years can be proved through the launching of technological innovations. The increase in the number of visitors and exhibitors, between nationals and foreigners, proves that the decision made in 1993 was the right one.

According to HĂŠrcules Ricco, event Director, “Brazilians are passionate about cars; actually, they are passionate about 12

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Argentine companies and entities: ABERALDO PONGOLINI SRL ALTISSIMO - OMER AUTOPARTES JULIO O. BUZETTI BASSO SA BELT TENSIONER PULLEY S R L CARPLA COMPONENTES ESPECIALES DIESEL SA ELECTROMECÁNICA VIC SA ETMA SA FAPERSA I.C.S.A FAROS AUSILI FRA S.C. FREMEC SA INDUSTRIAS METALÚRGICAS FKC SRL JAIME SERRAT E HIJO SRL JUNTAS ILLINOIS LIFTGATE PROCORDOBA PROV. BS. AS. SUBSECRETARÍA DE RELACIONES EC. INT. PROVINCIA DE SANTA FE - MINISTERIO DE LA PRODUCCIÓN RAFAELA MOTORES SA RICAMBI AUTO SPORT SRL SISCAP ACCESORIOS 4X4 TOVLENT SA - RETOV VESPOLI SRL VMG SA

parts and details. And that is why AUTOMEC is attractive to the public. The fair offers product releases that promise to change the automobile chain, with news for autoparts, services and equipments”.

This fair is supported by the main entities of the Brazilian autoparts sector, such as SINDIPEÇAS (Brazilian national union of parts industry for automobiles), ABRIVE (Brazilian association of independent automobile repairmen), ANDAP (Brazilian national association of autoparts distributors), SICAP (Union of wholesale parts and accessories for automobiles from Sao Paulo state), SINCOPEÇAS (Union of retail parts and accessories for automobiles from Sao Paulo state).

Edition 2011 This year’s edition welcomed international representations from other countries besides Argentina; there were also the international pavilions from Italy, Spain, Germany, Uruguay, China and Taiwan.

According to the survey carried out by the organizer, exhibitors from 30 countries participated in this edition and 97,000 visitors from over than 60 countries have attended the fair.

Argentine Participation Fundación ExportAr has been participating in this fair since 1997 and, in this occasion 27 Argentine companies were present in the Argentine Pavilion over a surface of 400 m2.

Likewise, the Argentine Pavilion due to the important industrial offer displayed attracted the attention of many visitors, not only local ones but also from Algeria, United Arab Emirates, Chile, Venezuela, Bolivia, Peru, the USA and India among others.

The Argentine space was outstanding not only because of its size but also for its artisan design, divided into three stands for companies from the province of Buenos Aires, Córdoba and Santa Fe. According to surveys carried out, companies told that they made 1480 contacts, which generate the possibility to make transactions for 9.4 billion USD as a consequence of their participation. In addition, 12 out 27 of the companies have managed to export USD 750,000 during the fair.

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Interview | Juan Cantarella, Association of Argentine Autoparts Manufacturers (AFAC)

Strong recovery and a promising future

Juan Cantarella, General Manager of the Asociación de Fábricas Argentinas de Componentes (AFAC), carried out a detailed analysis of the current situation of the sector and outlined a very promising outlook for the future. He highlighted that in 2010 exports of autoparts increased 26% and pointed out that while 15 years ago our products reached a hundred countries, nowadays, we are exporting to 146, which represents an increase of 46%.

His opinion is below.

“Autopart exports, which during 2009 had decreased 24.6% in relation to 2008 as a consequence of the world crisis, recovered strongly with an increase of 26% in 2010, reaching 2.422 billion dollars. To understand the magnitude of this figure, it’s worth remembering that last year, comparatively, the exports of meat reached 1.7 billion and those of wine 741 million”, said Cantarella.

According to the analysis of exports for 2010, from AFAC, the following items can be highlighted in relation to the involvement of destination countries: - Brazil’s share with 1.576 billion dollars within the whole sector, (increased over seven percentage points in 2009 and continued with a share increase of over one point in total exports in 2010), currently explains almost two thirds of the exports of autoparts.

Among the main exported products, the highlighted ones are gearboxes (485 million dollars), engine components (160 million), bodyworks and parts (147 million) and tires (145 million), among others.

- The US continued to be the second main destination of exports of autoparts. Tires (35 million dollars), engine components (19 million), internal equipment (11 million) and shock absorber systems (9 million) were sold to that country, among other products.

- Exports to Mexico constituted the third main destination of auto component exports. Almost half of the exports were gearboxes (55 million dollars), followed by engine components (almost 9 million) and components of shock absorbers (almost 5 million), among others.

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-Chile came to be the fourth destination (it had been the fifth), with exports of USD 87 million in 2010. Gearboxes (31 million dollars), electric equipment (9 million) and engine components (7 million) were sold to the neighboring country, among the main items.

Shipments to Venezuela occupied the fifth destination of autoparts exports with 86 million dollars. We mainly exported gearbox with their parts (29 million dollars), bodyworks and their parts (15 million), engine components (11 million) and internal equipment (7 million) among other components. The exports to Uruguay reached 53 million.

On the other hand, autoparts exports to Spain reached 63 million dollars, and to France 35 million, these two being the main destinations in Europe.

“It is also remarkable that 15 years ago Argentina was exporting autoparts to a hundred countries, but we now reach 146 international destinations to which we send autoparts manufactured in the country, which shows significant qualitative improvement”, pointed out Juan Cantarella.

“It’s worth pointing out that there is a group of national capital autoparts makers in the National Capital city that for many years has been actively involved in fairs and local and international exhibitions. Around 30 Argentine companies participated in Automec (the most important fair), most of them SMEs, providing that 65% of exports are aimed at that market. This group of companies feels the support of Fundación ExportAr, which has become a facilitator of the participation of these initiatives. It has managed to successfully coordinate efforts that were being carried out in an isolated way, generating greater effectiveness in developed actions”, stated the executive director of AFAC at the end.

Interview |

Juan Cañellas, OMER

We have consolidated our position in Brazil One of the Argentine companies that participated in Automec Sao Paulo with great success was “Altissimo S.A.” owner of the brand “OMER”, which manufactures propellers for fans and electro fans. The company, headquartered in San Martin, Buenos Aires, was founded in 1954 by its current president, Mariano Bitocchi.

for which we have cutting-edge technology, like CNC, EDM, 3D Digitalizer and 9 injection molding machines with capacity up to 2 kg. Furthermore, our company is working under the Quality Management System ISO 9001-2000, permanently implementing controls that assure the approval of the products”, the businessman declared at the end.

“The fair allowed us to strengthen the commercial bonds that we have with Brazilian buyers. Our goal is to consolidate our positioning in that country and the event resulted useful for that project”, said Juan Cañellas, General Manager of the firm.

Cañellas, son-in-law of the founder, highlighted the family spirit of the firm, which has set as a main goal to position their products in all the Latin American market. That’s why, besides having participated in International Fairs for over 11 years, they also plan commercial trips ad hoc. “We will visit Chile, Paraguay, Uruguay, Peru, Ecuador, Colombia and Venezuela, during this year, where we also have customers and our intention is to keep positioning ourselves as the only alternative brand to the original equipment. The idea for this year is to participate in a Fair in Mexico and take the opportunity to visit our customers and potential future buyers in that country”, revealed Cañellas.

“It was the sixth time we had been to Automec Sao Paulo and the result was very positive. We have met over 80 important contacts. I should highlight the help that ExportAr gave us at all times. The Foundation’s work is vital for us and there is evidence of that: we have participated in 29 International Fairs and in 25 of them we have gone with ExportAr. That is to say, we work jointly in order to reinforce and conquer international markets”, assured the Business Manager.

“The permanent planning of production of new items is reflected in the more than 360 models of fan propellers and 160 models of electro fans, applicable to different types of vehicles, automobiles, trucks, tractors, forklifts, power generators, road machines, etc. which places us as the world leaders in the industry”, he added.

“Some of our customers are leading companies in the automotive market such as Renault, Peugeot Citroen Argentina, Petrak S.A, Intl. Engines South America S.A. (Argentina-Brasilera), Motores Cummins (Argentina – Brasilera) and Agco SA, among others”, said Cañellas.

“Investment, aimed at improving quality permanently, allows us to manufacture all types of patterns and injection molds, News

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Automec 2011

The market Brazil is a country with a vast territory of 8.5 million km2. It shares boundaries with 10 countries in the region, and has a population of nearly 200 million inhabitants.

Nevertheless, Brazil’s relevance is not only due to its territorial surface and population but due to the economic relevance it has gained in the region and the world as well. Brazil has become a highly competitive and dynamic consolidated economy in which services concentrate 67.5 % of its GDP, followed by the industry with 26.4%. In this regard, Brazil has consolidated as the first Latin American economy, the second one in the continent, behind the USA, and the seventh in the world.

As regards international trade, in 2010 the exchange reached 387 billion dollars, out of which 199.7 million dollars were consignments abroad, with China, the US and Argentina being the most important destinations. On the other hand, imports in 2010, increased to 188 billion dollars, with the US, China and Argentina as the main suppliers.

As regards bilateral trade with our country, it is important to highlight that Brazil is the principal destination of Argentine exports with consignments in 2010 for 14 billion dollars, with manufactures of industrial origin representing 69.2 % of the total exports. Among the main export products mention should also be made of automobiles and autoparts consignments for 6.300 million dollars; chemicals 1.011 million dollars; fuels 970 million dollars; grains 991 million dollars; electrical machinery and appliances 767 million dollars. The five main export products represented a 70.1% share of the total exports.

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The sector Argentina has long experience in producing and exporting automobile and autoparts that continues to date. This tradition is not the only distinctive mark of the automobile- autoparts production, mention should also be made of the high quality finish of products and highly qualified work force employed, which makes this industry very competitive in international markets with high quality standard levels. These factors have enabled Argentina to be recognized as a supplier for the most important automobile trademarks.

As regards exports, the automobile-autoparts industry has become the main industrial exports sector, with a 33.6% share in the total amount of industrial manufactures exports. Out of the total exports of this industry, the autoparts industry contributes over a 30% share. The abovementioned has allowed this industry to consolidate as the second total industrial export complex behind oilseeds crops.

The autoparts sector is made up of 10 auto terminals and 400 manufacturers (mostly in the provinces of Buenos Aires, Córdoba, Santa Fe, San Juan, San Luis, Tierra del Fuego and Tucumán). Production and exports levels reached has led the sector to employ directly 58,000 workers and indirectly 200,000, so becoming one of the main employers in the industrial sector.

The great dynamism of the sector is due to the fast recovery from the crisis of 2001/2002 and the world crisis at the end of 2008. In this respect, since the 2002 crisis, this sector has grown 350%. This evolution increased the Argentine share of world production reaching 1% of the same. So in 2010 exports reached 8.092 billion dollars and autoparts contribute with figures above 2.500 billion dollars.

Among the reasons for export growth there is an outstanding increase of consignments to Brazil –which represent 78.3% of total shipments- and those sent to Mexico, Chile and Uruguay. Automobile and autoparts exports represent 11.8% of the total amount of exports from our country.

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Interview | Diego Turco

Grupo Unesa: working together for growth He has been a member of the Program of Export Groups of the Foundation ExportAr and Standard Bank for 10 years

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In a few months, the Group UNESA will be 10 years old. It is one of the first consortiums of exporters in the country, made up of companies that manufacture different lines of tools, machines and equipment for the industry, the hardware and the construction sectors. They are companies located in San Francisco, Córdoba, in the hub of the humid pampas that rescue these shared values.

Members of the group are companies 15 to 50 years old in this activity of the market, being, in some cases, conducted by the second generation. Diego Turco, responsible for the company JIT that manufactures pneumatic grease pumps, and as a member of the group, has told us all the details related to the history and activities of UNESA.

It is very important to become internationalized in Latin America, in a highly competitive market, in which the quality of European products predominates with prices of China and India. Today we sell in Chile, Colombia, Peru, Uruguay, and Ecuador and to Central America and Mexico in smaller amounts.

When was the Group born?

What kind of support do you have?

In May 2002, and with the expectation of a new country, with an exchange rate that was improving competitiveness, those of us who had experience in international trade but had not yet consolidated ourselves, got together and due to common interests, decided to make a commitment to make up a group.

Who are the members?

We are 6 companies: TEYBO (construction machinery); HEDU (grinders and hydraulic presses); DELBRE (woodwork machinery); JIT (lubrication tools); EJP (hand tools); METALMED (walrus and tools). All of them have between 5 to 15 operators, and commercialize an integral portfolio of 100 hardware products.

Why did you decide to form the group?

Because we wanted to find a way out of the crisis and thought that there were different conditions; we worked a lot on the idea of the companies having similar characteristics and the same enthusiasm to reach a common goal.

Then you can list the activities that are based on the spirit of pulling together. Today, the group does not only think of exporting, but we also jointly solve issues to complement production in order to improve quality and innovation, to look for new areas and representatives in Argentina; to exchange working experiences to solve conflicts or improvements in this field, in the import of supplies to add value; common purchases, etc.

What are the goals for 2011?

Every year we establish a Travel Plan with a budget made up of a flat fee, extraordinary contributions and the advantage trips with special offers. The idea is to always keep consolidating the existing market and reaching new destinations.

We take advantage of everything we can: in the trips, the PROCOR agenda, and in ExportAr in setting the agendas together. We still participate in the meetings of associative groups promoted by Fundación ExportAr and Standard Bank to be updated in all topics. Between 2006 and 2007 we had economic support, but we are still within the framework for the exchange of experiences. We have developed an assistance program with the Cámara de Metalúrgicos de Rafaela y ADIMRA (Mettalurgical Chamber). We are working on an associative PACC program for the incorporation of machinery and technology and performing a diagnose program for management of innovation promoted by UIA and the Centro Comercial Industrial Rafaela.

Do you participate in International Fairs?

We don’t participate in so many fairs, we prefer business trips and looking for representatives. We perform prior market research, adjust the agenda and we travel individually or taking advantage of some promoted event.

What do you need to keep growing?

What are the achievements you have obtained so far?

There are many aspects that could help improve associative competitiveness, managing groups to have adherent members. The companies with fewer expectations that can add their products to our portfolio mean a great advantage, because in the consolidation there is value rescued by suppliers. Fostering differential rate financing for groups would be a good incentive. Even though we could be a little bit more critical in some aspects, we are very optimistic and we have always cooperated in the promotion of new tools, a commitment that we still have.

Being able to export and consolidate our group under law 26.005 was one of our biggest achievements, especially obtaining operatively an internal combination of products, exporting as an only provider and charging currencies individually to every member. Removing the tax intermediation made us more competitive, it took as a long time but it’s one of the big achievements.

It is essential to keep with the trip programs and missions in order to promote groups, and we have been doing that pretty well. Current promotion tools, as well as others, must find in business chambers and municipalities dissemination and implementation teams in order to obtain more benefits and make them more massive.

The whole path has positive experiences, each stage has taught us something. At the beginning we organized ourselves according to the knowledge of every member, and then we thought it was important to have a manager that would carry out our aspirations and we hired a company to coordinate that. With time, the evolution led us to hire a manager under an employment agreement; also it led us to have an office, a warehouse and to start working as a company.

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Missions | Trade Mission to Mexico

Resounding success of the Trade Mission to Mexico A trade mission to Mexico of almost 200 Argentine entrepreneurs achieved its objective: to lay the bases to increase exports and bring more investment to the country. To get an idea of the magnitude of this trip, it is worth reviewing the words of Ambassador Luis María Kreckler, Secretary of Trade and International Economic Relations in the Argentine Foreign Ministry: “It was the most important trade and investment mission in recent years”.

The privileged nature of the relationship with Mexico was expressed in the 2007 Strategic Association Agreement with the aim of strengthening and intensifying trade links on the basis of reciprocity, common interest and complementarity.

Global bilateral trade between both countries rose threefold between 2003 and 2010, from 1 to more than 3 billion dollars, the historical maximum negotiated to date, but there is still enormous potential to develop.

“Argentina and Mexico work together on the strategic nature of the relation. We’ve made remarkable progress since we took on the challenge of developing the enormous potential in the relationship between two dynamic economies,” said Kreckler after meeting the Mexican Economy Minister, Bruno Ferrari.

“We need to begin joint work to boost the flow of trade that our economies are in a position to produce and consume, seeking new forms of complementarity and production 20

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integration that will allow a more balanced and equally beneficial trade for the parties,” said the Secretary.

Argentine exports to Mexico rose from 800 million dollars in 2003 to over 1.2 billion in 2010, with a maximum sales peak of 1.5 billion in 2006.

“In 2010 we proved that we can not only recover but also build on the amounts traded prior to the world crisis. We’re designing a strategy in the framework of the Strategic Association Agreement for bilateral trade to reach 8 billion over the next five years,” added Kreckler.

Five products make up 52% of our exports to Mexico: commercial transport vehicles (USD 300 million); aeroplanes (almost USD 200 million); gear boxes for cars (USD 75 million); silver ore (USD 46 million) and liquid propane (USD 43 million).

In terms of investments, Mexico has gained in importance

as an investor in Argentina, occupying the 14th position among foreign investors, with a stock of USD 1.4 billion in 2009, concentrated in the communications, food, beverages and tobacco sectors.

“The Argentine Foreign Ministry has presented an investment portfolio with projects exceeding 5 billion dollars,” explained Kreckler.

It is vital to proceed to coordinate efforts to stimulate corporate relations, helping to identify new business and investment opportunities, production complementarity and alliances to tackle production platforms that will allow us to supply third markets.

The intensity of the bilateral relationship and the common ground between both governments were apparent in this new visit by a large delegation of public officials and business people, perhaps the largest and most important by an Argentine delegation to Mexico.

Naturally, a relationship with this degree of intensity should have a high level forum to discuss pending issues of shared interest.

by Mexico and industrial ones by Argentina for which it will be necessary to consider intensifying trade in certain products individualized by the governments and with initiatives jointly proposed by the private sectors of both countries for the consideration of their governments.

In that regard, steel quotas, government purchases and the entry of Argentine wines were part of the agenda presented

by Argentina.

As part of the efforts made to open the Mexican market for different vegetable and animal products, a meeting was held between the sanitary services of both countries, in order to decide upon a work programme.

The trade mission included representatives of Renault, Toyota, General Motors, Ford, Volkswagen and the Association of Automobile Factories (ADEFA). Besides representatives from the car sector, Miguel Acevedo and Luis Betnaza travelled in representation of the industrialists and the vice-president of the Argentine Chamber of Trade (CAC), Eduardo Eurnekian.

The UIA and the CAC signed cooperation agreements with their Mexican counterparts.

Questions of access to markets were part of the agenda dealt with by Secretary Kreckler with Mexico’s Economy Minister.

“The trade agreements in force are basically industrial, with few agricultural and agroindustrial products. As we advance in the process of trade liberalization it becomes more complex to strengthen the Bilateral Economic Complementation Agreement,” said Kreckler.

The dynamism of complementation forces us to think of the need to study the incorporation of agricultural sectors

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Business opportunities in Mexico The Federal Republic of Mexico is currently the second largest economy in Latin America after Brazil, and the fourth in the continent. After the 1994 economic crisis it returned to growth, allowing the majority of its population to increase their consumption capacity. Mexico’s large domestic market makes it an attractive opportunity for Argentine exporters.

The Federal Republic of Mexico is in North America and it is a country of superlatives: it is the fifteenth largest territory in the world, a market of more than 112 million people (which makes it the 11th largest population), while in the field of economics it is the thirteenth largest economy and the second in Ibero-America, with a GDP of 1.004 billion dollars in 2010.

Its political and economic importance have made it one of the main recipients of foreign investment in Latin America, and one of the most influential voices from the region in different world forums.

therefore has legislation on safeguards, compensations and antidumping measures compatible with international norms.

The current Mexican economic scenario is the result of a long process of reforms started during the 1980s, the result of international circumstances and changes to the development model, which was no longer providing the desired benefits.

With this change of policy, it has undertaken an ambitious programme of economic internationalization that includes various agreements on trade and tariff preferences. These agreements created an export platform that made access to large foreign markets easier for Mexican products, particularly its industrial products. It should be pointed out that Mexico belongs to the World Trade Organization (WTO) and

As regard trade relations, Mexican exports rose to a total of 297.713 billion dollars in 2010, and its principal trading partners were the United States (taking 80.5% of its total sales), Canada and Germany. Likewise, imports in the same year rose to a total of 300.738 million dollars, with the United States again as main supplier (the origin of 48% of purchases), followed by China and Japan.

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As regards its economic structure, services are the predominant sector in national GDP, accounting for 62.5%, while industry and agriculture have shares of 33.3% and 4.2%, respectively. The main Mexican industries are those based on foods and beverages, tobacco, chemical products, iron and steel, oil, mining, textiles, clothing, automobiles and tourism.

Trade relations between Argentina and Mexico have experienced rapid growth over the last ten years. Total trade (exports plus imports) between both countries has grown

Argentine exports to Mexico disaggreated by Big Sectors. Year 2010 4,8% Fuels and energy

6,6% Primary products

13,9% Manufactures of agricultural origin

74,6% Manufactures of industrial origin

Source: own data based on ARGEXIM

229% since 2001, reaching nearly 3.036 billion dollars in 2010. The trade balance returned a surplus for our country in the period 2001-2007, but the strong growth in imports of the last three years has resulted in a large deficit for Argentina, reaching a record USD -598 million in 2010.

National exports to this country recovered strongly in 2010 to reach USD 1.219 billion, up almost 30.8%. It is worth pointing out that in 2009, due to the effects of the global crisis, our sales to Mexico shrank by 30.2%.

Mexico is currently the 15th national destination for exports and the sixth in Latin America, after Brazil, Chile, Uruguay, Venezuela and Colombia. In 2010 sales to Mexico accounted for 1.8% of Argentina’s total exports.

There are also other significant export sectors that can be grouped together in what could be called the auto parts sector: machinery and apparatus, electrical material, including sales of important products such as internal combustion engines and pumps, and rubbers and their manufactures, including tyres. All together, exports to Mexico by the auto parts sector thus exceeded USD 171 million.

Chemical products were another sector reporting strong performance in national sales, reaching 111 million dollars, with five-year (2006-2010) growth of 51.3%. The most significant sectors in this area are perfumery and cosmetic products that account for 41% of sales, and pharmaceutical products, with 28%.

Our country is 23rd in the list of Mexican suppliers with a share of 0.37% of total purchases from the country.

However, if we look solely at Mexico’s purchases from our region, Argentina is in fourth place in importance in Latin America, after Brazil, Chile and Costa Rica.

Concerning the composition of sales from our country to Mexico, in the last ten years there has been a noticeable trend towards Manufactures of Industrial Origin. In the last year of the study, they represented 75% of sales, followed

by Manufactures of Agricultural Origin, which accounted for only 14%. The predominant sector during the period analyzed was terrestrial transport material; in 2010, the sector accounted for 35.4% of sales, with almost 432 million dollars. However, sales by this subsector were made up of 72% of vehicles for transporting goods, 22.8% of spare parts and accessories, and 5.1% of automobiles.

Trade promotion activities of Fundación ExportAr in Mexico in 2011: International Fairs: Expo-Antad (Food and beverages) Guadalajara, 9-11 March Guadalajara Book Fair 26 November - 4 December News

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Strengthening our relationship with the Argentine-Arab Chamber of Commerce An agreement was signed to promote economic, commercial and business cooperation Fundación ExportAr signed a new agreement in the last few days. This time and following the strategy set by the Ministry of Foreign Affairs, they inaugurated a relationship that reinforces our connection with the CCAA even stronger, a friendly entity with which we hope to jointly make multiple actions. The main objective of the agreement is to reinforce relationships between the two bodies and foster economic, commercial and business cooperation. There will also be focus on business connections and on developing new forms of collaboration aimed at the economic development of Argentina and countries of the Arab world.

The first item of the agreement establishes that both parties are bound to take as many necessary actions within the framework of their competences, in order to foster the economic and commercial exchanges between Argentina and Arab countries. For that, there will be periodical meetings in which the development of the actions will be assessed and the best strategies to achieve the intended objectives will be set forth.

ExportAr and the CCAA will exchange publications and information about their respective markets, especially in the field of standards and procedures regarding marketing of the products, from the point of view of the promotion and expansion of the bilateral commercial exchange. Furthermore, they will assure reciprocal assistance in sharing third parties available commercial information and they will maintain a degree of confidence of the exchanged commercial information destined only for the exclusive use of both parties.

They have also agreed to promote and support the exchange of commercial missions between Arab countries and Argentina, such as visits from businessmen, either individually or in groups. There is even a plan to help in the training of staff with advanced courses. “We want to foster the execution of seminars for commercial workers of both countries”, said Mr. Juan Usandivaras, Executive Director of ExportAr after signing the agreement.

Another important item of the agreement is the one that mentions that the two parties will favor connections among businessmen and commercial companies with the objective of industrial and commercial collaboration, as well as making combined partnerships to operate both in their markets as well as in others.

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Edgard Omar Figueredo, president of CCAA, expressed his satisfaction at having signed this agreement with ExportAr and said he relies on the fact that this agreement will consolidate the relationship between the bodies and improve the commercial performance of Argentina and Arab countries.

“The CCAA, a non-profit civil organization, will be 82 years old on July 29th. During those years, the objective has been to increase bilateral and commercial relationships. Today, regarding the exchange promotion, we can say that the total of 3.7 billion dollars that Argentina exported in 2010 to the region, are the result of permanent efforts and disciplined work in the Ministry of Foreign Affairs, International Trade and Worship and our entity”, Figueredo pointed out.

“It is also necessary to highlight the importance of the economicpolitical context, in which the best achievements of the Argentine-Arab exchange took place in the last years. The Board of Directors of the Argentine-Arab Chamber of Commerce is proud to incorporate now to its activity, through this agreement with Fundación ExportAr, those who will unquestionably enlarge, with their experience and work, the bilateral and commercial relationships with Arab countries”, the director finished saying.

Innovative agreement with the Standard Bank Foundation Standard Bank and ExportAr will jointly approach research and training With the objective of fostering and developing joint activities related with foreign trade, and following the articulation plan provided by the Ministry of Foreign Affairs, Fundación ExportAr and the Standard Bank Foundation signed a new cooperation agreement. The tasks that both entities will approach jointly are mainly of research, training and promoting of international trade.

Juan Usandivaras and Marcelo Dupong, respective Directors of the foundations, signed the agreement, which will be valid for two years. This term will be renewed automatically, which will give the ambitious project sustainability over time. Omar Sproviero, General Manager of the Standard Bank Foundation, who indicated that Felix Peña, Director of the Institute of International Trade and Elvio Baldinelli, Director of the Institute for the development of Consortiums of Exportation, will have direct involvement in the task.

“We are convinced that this agreement will allow us to obtain an efficient management of international trade”, said Usandivaras, who highlighted the responsibility of ExportAr: “boost the development of exportable supply and the inauguration of external markets, through the use of innovative export promotion tools.”

The signing of the agreement is going exactly in that direction and will allow carrying out programs and activities to be carried out to train businessmen, teachers, journalists and personnel for public and private bodies in order to consolidate export awareness. “Education and training are considered by ExportAr basic and fundamental tools to further the process of internationalizing national companies”, said Usandivaras after signing the agreement.

The agreement will be developed and implemented under the joint coordination of both Foundations, both of them being able to sign complementary amendments that would entail a better execution of the proposed objective.

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Amb. Ariel Esteban Schale

Results of the economic development model in International trade: exports keep growing and break a new historic high The strong rate of economic growth in Argentina has caused a steady increase in exports that keep surpassing historic highs and breaking higher and higher new records. In fact, at the closure of the first quarter of 2011 those external sales reached over USD 23 billion, which means an increase of 22% compared to the same period of last year, and of 40% compared to 2009. This exchange had reached its maximum peak in 2008, with over USD 70 billion per annum and around USD 22 billion in the first four months.

This means that the transactions done between January and April 2011 are already 6% above that historic record previous to the world crisis.

The composition of big industries in Argentine exports represents another piece of information that accounts for the new positioning of our country in world markets. In fact, in 2010 and for the first time in our century, manufactures of industrial origin (MOI) were at the top of foreign sales. In the first four months of last year, they added up to USD 7 billion with a participation of 36%. It’s a trend whose continuity we can verify in 2011, when exports of manufactures of industrial origin reached USD 8 billion, which means an increase of 16% compared to the previous year and 60% compared to 2009. Furthermore, if we add all manufactures of agricultural origin, we verify the dominance of finished goods is maintained in our external shipments, which in the first quarter of 2011 reached a participation of 70%, consolidating with that continuity the results of the same period of last year.

From the Under Secretariat of International Trade of the Ministry of Foreign Affairs, we apply specific policies aimed not only at increasing the amount of exports, but also at diversifying their composition through the incorporation of products with higher added value levels at origin for their positive impact in knowledge and job generation, and, as a last resort, their contribution to the sustainability of the economic growth model with social inclusion designed by the national government. In that regard, it is important to point out that these unprecedented results of Argentine foreign trade represent one of the growth engines 26

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made possible based on the function of harmonization of macroeconomic variables and the balance of internal and external numbers through State policies.

It is based on these extraordinary results that our future prospects are optimistic. It is an informed optimism based on concrete data of the international, regional and local context. In fact, in the first case we have verified that for the first time in quite a while back there has been growing external demand for the goods that we elaborate in our country with proved quality and competence, in part, due to the incorporation of millions of new consumers to the global production system. In the regional scope, the growth rates, comparatively higher than those of emerging economies, provide us with a historic opportunity to capitalize the trade growth to reach a new development level. Finally, in the local area we have a development model—model where medium and long-term goals are established, and that it has shown its capacity to balance the components of the internal productive and financial structure, redefining at the same time its external insertion and boosting a sustainable growth project that keeps increasing based on the two pillars of the value chain represented by the agriculture and the industry—that guarantees the frame in which the foreign trade will keep growing, with prospect of a new external sales record around 80 billion dollars.

Interview | Paula Yañez

ExportAr is a great place to work Paula Yánez worked in Fundación ExportAr from 2000 to 2006.

Paula’s great working performance provided her with a scholarship to further studies in International Trade at the Standard Bank Foundation, and then she continued her degree at the UCES (University of Business and Social Science). Today, she works at Mazalosa S.A. (Portsaid, Desiderata and System Basic) and tells us how she built her career, since starting out as an assistant in our organization.

How long did you work in Fundación ExportAr and what did you do?

How important do you think continuous training is for the current labour market?

I worked there for 6 years. I started answering the phone and doing assistant tasks. I used to photocopy materials, and watched and learned how to give advice. Then I worked in the MERCOSUR area, where I used to deal with law firms, and finally I ended up working with Sectors, where I started with the design sector, then cosmetics, clothing and lastly the food sector. In turn, I run workshops for companies and seminars related to the first steps in the export process.

International trade requires constant updating, since rules and regulations change all the time. If you aren’t up to date you run the risk of being excluded from the labour market.

Where do you work today and what do you do?

What do you think you gained from ExportAr? I think in positive things such as making contacts, training, meeting very good people that currently work there or those that used to do so, the evolution it has achieved as an export promotion agency throughout the different managements. In all, it was a great time for me and not easy to forget.

Today I work at Mazalosa S.A., an Argentine company that manages Portsaid, Desiderata and System Basic. I give support to the commercial area and I also take part in the import and export aspects of the company.

What did you learn in ExportAr that is useful for your present job?

I learned how to manage the Argentine representation abroad, how to take part in business rounds, how to carry out market research and, above all, what each client wants and how.

What do you think are the opportunities Fundación ExportAr offers to employees that have just joined the labour market?

I think it is a great place to make contacts by fostering good relations. At the same time, it is a great place to work while studying because it offers flexible working hours.

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Interview | Elvio Baldinelli

Union is strength. More and more SMEs form consortiums to be able to export Elvio Baldinelli is a member of the Board of Directors of Fundación ExportAr and Vice-president of the Argentine Chamber of Exporters.

Since 1998, he directs the “Institute for development of export consortiums” of the Standard Bank Foundation, where he works together with Fundación ExportAr to facilitate the penetration in external markets of consortiums made up of SMEs from the whole country. In this interview, Baldinelli explains the mechanics of the program, its benefits and how the development of the consortiums or groups in our country has evolved.

How does the consortium program operate together with the Standard Bank Foundation and Fundación ExportAr? Fundación ExportAr, together with the Standard Bank Foundation, develops a program aimed at forming consortiums or groups of companies united to increase their chances of entering their external markets with their products.

Due to the fact that in Argentina or in any other country it is not easy to break the natural resistance of firms to associate, both foundations stimulate their formation financing initially fees of the person who will coordinate their efforts.

Also, their employees have monthly meetings with coordinators during the first two years in order to analyze the reports about their activities. There are also meetings in which every coordinator goes with representatives of the group companies; there are meetings to which employees of national and provincial bodies are invited to explain the way in which they support the exporting effort of the groups. A procedures manual for coordinators and another one for companies have been created, and lately, a news bulletin “CONSORCIOS” is being published, gathering the news prior to the publishing date of every issue. The information about the support provided by the Foreign Service of the Nation and Fundación ExportAr to approach exports of the groups can be found on the web page www.exportar.org.ar or www.grupos. fstb.com.ar 28

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What are the roles played by the development groups in a SME? Sometimes, SMEs, despite having international competitive products, are not ready to undertake the necessary steps to become exporters because they have few executives, sometimes just one owner who is in charge of all the necessary production and marketing processes. Due to these circumstances, it’s not easy to undertake the actions that would lead to obtaining customers abroad. This is where the association with other companies facilitates the task.

The first condition that a company that wants venture into the international market must satisfy, is having a product that is ahead of the ones it’s going to compete with, either because it is something that doesn’t exist or it is scarce elsewhere, like the case of some foods or raw materials, or because its manufacture is distinctive due to innovation or due to the quality or post-sale services.

In Argentina, out of the 120,000 SMEs that we have, 6,000 export, i.e, just 5% sell to other countries. In Italy, this type of companies are responsible for much more than half of what is exported, while in Argentina it only reaches 10%.

In any case, just a low proportion of SMEs can export here or anywhere else in the world. The reason why is because there are always minorities that manufacture international competitive

When a new group is formed, it would be normal that just some companies have experience exporting. After some years of operation, all of them are exporting to some extent, something that they would have never done hadn’t they been part of the group.

In the last decade, over 200 consortiums of exporting companies have been created. Almost half of them are still working, while the rest has dissolved, some of them because they’ve reached the desired goals and others because had been unable to reach their initial expectations.

Both in the case where consortiums are working, as well as when they are not, the companies that intervened acquired great practical experience. Since the average number of companies that usually make up a consortium is 8, about 1,600 obtained the training. I’ve already said that in our country where there are 120,000 SMEs, around 5,000 of them are exporters, a figure that highlights the significance of 1,600 SMEs benefiting from an associative experience. goods, since most of them use long-standing technologies, which gives room to similar productions in almost every country. But it is also true that it is usually enough for a certain amount of them to export in order to obtain the necessary currencies.

So the idea is not to have the greater part of Argentine SMEs exporting, but to have a bigger amount than what we have now.

How has the program evolved?

The program started in 1998 and it is still far from its completion.

Even though a lot has been done, it is very little if we consider everything left to do. The task is very similar to that of building a house in which people have been working for many years, and where many rooms have been added along the way but there are still many more to add.

But a higher share of SMEs in foreign trade is not only essential for the country, but it’s also convenient for them to do it for two reasons.

Firstly, the company that exports does it based on the fact that it has a product with some advantage compared to its competitors, either in quality, innovation or post-sale services. It’s not practical for a company to have two production standards: one pursuant to the local market and a higher one for export, so when the company is forced to be competitive in international markets, it acquires a greater penetration in the domestic market and it can better defend itself from importing.

At the end of the year 1998, we had three groups integrated by 30 companies; today we have 75 with 450 companies.

Secondly, the advantage appears with economic recessions, given that when domestic sales decrease, a company that sends 30 or 40% of its production abroad suffers less than those who only work for the local market. Furthermore, those who are already exporting can easily increase their amount, because they already have the proper product, customers abroad and the know-how.

How do companies benefit from conforming groups/consortiums?

Is the creation of groups in the interior of the country being fostered?

Without any doubt, the most important job that consortiums and groups do is sales trips abroad. Despite the fact that nowadays we have real time effective and cheap communication means, they have not replaced the ultimate role that personal contact between parties has for international trade.

In many cases a company can represent the rest of the consortium in trips outside the country, seeking customers. It is easier to have good agents and representatives if they are offered to sell products from a group of companies than just one company alone.

It is cheaper to open a warehouse outside the country from which goods can be distributed if there are many companies coping with the expense, and above all, as time goes by trust among partners is consolidated and the exchange of knowledge among them facilitates greatly the penetration of foreign markets.

Another effective activity is attending fairs and exhibitions.

The most useful ones are those dedicated to different areas of production, where buyers and sellers, not just from the host country but from many others, gather.

Yes, it is. Today almost half of the groups are concentrated in the city and province of Buenos Aires but we have a dozen in the province of Santa Fe. There are three in San Juan and we have traveled with three employees of Fundación ExportAr to start two more. There are three groups operating in Mendoza; on the same trip we stopped by Fundación ProMendoza to start another one, we have two more in Cordoba and one in each of the following provinces: Chaco, Corrientes, Tucumán, Chubut and La Rioja. On the other hand, employees of Fundación ExportAr and Standard Bank Foundation travel every two months to Santa Fe, Córdoba, Mendoza and San Juan to meet with the coordinators of the existing groups there and the respective provincial authorities.

During the rest of the months, the coordinators travel to Buenos Aires to meet with us here. In those cases, Fundación ExportAr takes care of the tickets and some expenses.

On May 12 last year, the two Foundations organized a meeting in Buenos Aires for employees of the foreign trade area of the provinces and from the City of Buenos Aires to share their plans and experiences in business association matters for exporting purposes.

The support provided by Fundación ExportAr and the Standard Bank Foundation to this process is very important, but international experience has taught that for the successful News

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development of export consortiums activities, the provinces or regions of every country have to play an important role.

This has been the reason why Italy, Spain, France and Sweden resolved that the most efficient way of helping consortiums was delegating their management to regional or local levels. The efforts made by many Argentine provinces are worth pointing out, such as that of Santa Fe, Córdoba, Mendoza, San Juan and the City of Buenos Aires to help the existing groups in their territories. Also some municipalities make similar efforts, mainly that of Rosario.

Do you think that the economic framework will lead to the creation of more groups in the short term?

Mr. Juan Usandivaras has set as a goal for 2011 the creation of 30 new groups, many more than in previous years. This goal is being accomplished, provided that many months before the end of this year, eleven new groups have already been formed.

How many groups are currently working with Fundación ExportAr? Which sectors have the greatest amount of groups?

Currently there are 75 groups made up of 450 companies working in our program. Regarding distribution by sectors based on amounts exported, the most important one is capital goods with 54% of the sales, followed by foods and beverages with 32%, consumer goods with 12% and services with the remaining 2%.

Does being part of a group facilitate participation in fairs? Does it allow more profitable prices to be set?

In fact, another effective action for those who want to sell abroad is attending fairs and exhibitions. There, companies can compare their product to those offered by the competition in price, quality, presentation, technology and complementary services. Moreover, usually manufacturers of the sector’s equipment and machinery also attend, giving participants the chance to see the latest technologies. Some companies exhibit their product in a stand, which facilitates sales transactions, but in the case of companies that are starting to export, it would sometimes be better for the businessman to go around the different pavilions, maximizing knowledge and contacts, without being forced to assist those visiting his stand.

In many cases the companies of the group exhibit together, which allows for a greater range of products, besides reducing exhibition costs. Fundación ExportAr subsidizes part of the cost to rent and decorate the stand, as long as it is a fair or exhibition included in its annual program. It is also common for companies to use this opportunity to visit existing or potential customers in the host country.

When a group of the Program is interested in participating in an international fair or exhibition that is not included in the official program, it can request it be included by Fundación ExportAr. The latter will take care of the request as long as it is pertinent and it has the necessary budgetary resources. In order to request this support, you can go to www.exportar.org.ar. The attendance of groups has been increasing over the years. In 2010 they attended 126 fairs, while in 2009, they had attended only 83.

What does a company that wants to participate in the group program have to do?

The current requirements for the program designed by Fundación 30

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ExportAr and the Standard Bank Foundation for the creation of new company groups are the following: - Groups must have a minimum of five companies and a maximum of fifteen.

- It must provide the total exported amounts in the last five years.

- It is essential that in every group there be more than one company already exporting that has the know-how to share with those who have not done it. By doing so, the latter can benefit from the experience of the former.

- Companies of a new group must have the same distribution channel abroad for their products. This makes the foreign interlocutors of each company of the group be from the same sector, either we are talking about potential customers, distributors, agents, representatives, as well as common promotion actions to be launched, as the attendance to fairs or the execution of sales missions. This information is detailed in the “handbook” on the webpage www.groupos.fstb.com.ar and there is a form to fill out for companies interested in forming a group.

A company that wants to enter an already existing group, can request to do so. Both members of the group as well as the two foundations will decide upon the request. The list of the existing groups together with their addresses can be found on the webpage www.grupos.fstb.com.ar

As Vice President of the Argentine Chamber of Exporters, how do you see the evolution of Argentine and world exports in the short-medium term?

After the recession that affected the world economy during 2009, the international trade is recovering. Regarding the future, if we focus on what Argentina is currently most interested in, everything seems to show that the demand and prices of raw materials will keep being high, probably during many decades.

But we must remember that in the past, Argentina for many years had had a wide market for foods in Europe, but that ended after the Second World War to the extent that we went from exporting before the war 70% of total exports to that continent, to only 19% last year.

Today the high demand of raw materials is originated in many emerging countries, mainly China, but it would be wise to recognize that we don’t always have tailwinds, as in Europe in the past. It is hard to know what will happen in the short-medium term, circumstances may change due to different and sometimes unexpected reasons.

One may think from the surprising fact that China might not need the one child policy anymore for population control. There, as well as in India, the same thing that happened in developed countries is happening now, they suffer from a strong decrease in the number of inhabitants, among other reasons, due to easy access to birth control methods. Nowadays, in China the number of children that a woman has stands at just 1.4 and the necessary figure for the population not to decrease is 2.1 children.

In the years of prosperity that we had, when Europe bought so much from us, we didn’t manage to develop activities that would complement exports of agricultural products, and that lack of foresight brought us poverty and frustration. In order to prevent ourselves from suffering the same thing, if for any reason the good times end, we’ll have to take the advantage to increase education and investment levels, as these would be the only ways to complement exports of raw materials with a sufficient manufacturing contribution.

Exporting Argentinas education. www.exportar.com.ar News

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Interview | Oscar Guardianelli, ProCórdoba Agency

Connecting Córdoba’s companies to the world ProCórdoba is the export promotion agency of the Córdoba province. Through its activities helps inland businessmen to develop international trade.

The province of Córdoba, located in the middle of the Argentine Republic, is one of the most important productive centres in the country. It has a wide and varied productive offer, since in its economic structure concentrates sectors that range from agrifood industry to metalworking industry, automobile and autoparts, agricultural machinery, aeronautics industry, and capital goods.

In addition, it has an important production in the industries of wool, leather, shoes, mining, plastics, electric material and medical industry. And, on the other hand, there are present new companies in the fields of electronics, information technology, communications, and tourism.

In this context, the province has a long experience in the field of international trade. Currently, its diverse production enables it to access more than 170 markets. In addition, foreign sales from Córdoba are growing significantly and represent 14% of Argentina’s exports.

In order to start or consolidate business abroad, companies from Córdoba enjoy the support provided from Pro Córdoba.

To learn more about this agency, we have talked to the president of ProCórdoba Mr. Oscar Guardianelli.

How was ProCórdoba Agency created?

ProCórdoba was created in 2001 as a mixed economy partnership: that is the public and private sector work jointly for the promotion and positioning of products from Córdoba in international markets. The Board of Directors is made up by the Government of the Province of Córdoba, the Municipality of Marcos Juárez, the Municipality of Villa Dolores, the Association of Food Industry of the Region of Río Cuarto, the Association of Businessmen Argentine Centre Region 32

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of Villa María, International Trade Chamber of Córdoba, International Trade Chamber of San Francisco and the Region, Metalworking Industrialists and Components Chamber, and the Industrial Union of Córdoba.

What is the main activity you do?

Our efforts are focused on the promotion of exports from different production sectors of Córdoba and, also, the international positioning of companies and products from Córdoba. In other words, we work to help companies be able to start with the exporting process or, if they have some experience already, to consolidate their trade marks and image abroad.

How does the agency help companies?

First of all, the agency can give advice and training to companies. We carry out some research, prepare and publish statistics reports on the evolution of exports, markets profiles and commercial opportunities. In addition, we offer trainings on international trade operations, tariff classification, customs system and international marketing. On the other hand, we coordinate a number of commercial promotion actions such as business missions abroad, participation at international

Capilla de Candonga

fairs with a stand and organize business rounds with foreign agents. Cooperation and international relations are other tools that strengthen the support to companies. So, we constantly work to strengthen our bonds with foreign institutions. In this regards, we are founding members of the International Network for Regional Trade Promotion Organizations, that is an association that networks with similar promotion agencies from different provinces and regions of the world.

Which are your goals for this year?

In 2010, ProCórdoba coordinated a total of 50 events that represented a 13.63% increase compared to the previous year. In these events 457 companies participated according to our agency records. Our goal for this year is to increase 20% the number of participating companies in trade promotion activities. That is we want to reach more companies from more industries.

What are you doing in order to achieve this goal?

In the first place, this year we have a more ambitious Fairs and Missions calendar than in 2010. We will be coordinating more than 60 international events, and what makes this calendar so outstanding is that, besides the activities designed for traditional industries already positioned at international markets, there are special activities designed for those industries that are beginning to export such as the dental industry, non-metal mining industry, potato production, plastics industry, among others.

companies and international finance organizations. So, from our agency we can facilitate the development of projects or gathering information on finance lines that allow incorporating technology, working groups become more professional, or achieve growth at foreign markets.

Lastly, we are conducting a number of training courses and visits to different towns and cities in the interior of our province to offer small and medium size enterprises ProCórdoba services and encourage them to become part of this experience in opening paths to the world.

ProCórdoba and Fundación ExportAr work constantly together, how do you evaluate this interaction?

We have been working together with Fundación ExportAr almost since our beginnings. Integration and interaction enable us to agree on strategies and foster our efforts to optimize resources and improve productivity aimed at offering businessmen the best services on trade promotion.

We are strategic allies when it comes to finding opportunities that will be of advantage to businessmen for arriving and consolidating themselves in international markets.

On the other hand, we are working in the design of new ratings and statistics tools to give businessmen from Córdoba all the information they may need when making decisions. At the same time, we are working on the development of a new service by which ProCórdoba will become the liaison between News

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A great opportunity for our companies

OUTSOURCE2LAC forum, organized by the IDB in Montevideo, made clear that we have to take advantage of the international demand.

Export of services is becoming more important every day and Fundación ExportAr is satisfying this demand with an intense action plan that will reach a number of twenty promotion activities throughout 2011. Under this framework we participated in the Latin America and the Caribbean Forum on Offshoring and Outsourcing (OUTSOURCE2LAC), held in Montevideo and which comprises all groups of this sector.

Everyday there are more and more companies seeking to outsource services in Latin American countries, that is why ExportAr as the export promotion agency of the Ministry of Foreign Affairs, International Trade and Worship, puts all the attention into this industry and is willing to strongly support local companies.

On this opportunity, seven Argentine companies participated in the stand in the Congress organized by the Inter-American Development Bank. Three of them belong to the health tourism industry (Dental House, Centro Oftalmológico del Diagnóstico and Clínica Nano); three suppliers of software services (Mobile Computing S.A., MAPPLO and DeLaPalo LABS S.A.); and one in the animation industry (Metrovisión Producciones S.A.) It is important to highlight that international export global services (offshoring) has increased two digit rates during the last decade and in 2010 surpassed 200 billion dollars. Out of that amount Latin America only grasps 8% of the market 34

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share which leads to arrive to the conclusion that this sector has a high potential for the region. The main groups in this market are Information Technology Offshoring-ITO, Business Process Offshoring-BPO, and Knowledge Process OffshoringKPO. The first one of the groups, ITO, comprises many activities related with information technology such as development and managing of applications, software, and network maintenance, among others. BPO comprises a wide range of activities from business resources administration such as logistics, finance, accounting, procurement, to managing client relation towards trade and sales services and call centres and contact centres as well. Finally, the KPO sector of recent appearance and with most development includes high added value services such as research activities and development, finance advisory, legal, etc.

Actually, the Congress held in Montevideo involved two days of work, with permanent sessions and a dynamic interview system by which Argentine companies were able to choose online potential buyers (35 interested persons assisted) and to arrange meetings, which in most cases turned out to be very productive.

This event broaden the possibilities to generate a wider networking María Laura Moure, CEO of Metrovisión Producciones S.A., one of the participating companies, shared her vision on the congress: “First, I would like to thank Fundación ExportAr for giving Metrovisión the possibility to participate in an event of high quality as OUTSOURCE2LAC. As in every event of this magnitude, it broadens the possibilities to generate a wider networking, one of the important pillars upon which we can relay when doing new business”, said Moure. “In this particular case, it has been very interesting to attend the different conferences by speakers from diverse sectors of Latin America, sharing their experiences or knowledge on Outsourcing and Offshoring”.

“In our case, an audiovisual services export company, we were able to link and/or extrapolate the most relevant topics of these disciplines, where I observed that are similar to those of any industry devoted to export

beyond the industry where it works”, added Metrovisión’s CEO. “The Argentine delegation was formed by companies from diverse industries such as health (dental and ophthalmology), other IT development companies, etc. The event organized by the IDB was perfectly ordered and managed, with a high quality attention, good attitude towards the participants”, said the businesswoman.

Finally, Moure expressed: “I came back with some points developed in order to advance in new businesses, and I am currently doing the follow up of those points. It is very positive to have some help of this kind for companies, and even better if they are conceived in delegations”.

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New regulation for in warehouse exporters In warehouse cargo loading shall be compulsory for those goods whose control at country borders may result difficult to be performed.

In accordance with the set of rules under the World Customs Organization, Customs Offices, as the government agency in charge of the control and administration of international goods movements, can, besides exercising its corresponding control role, offer more security to the world logistics chain, helping in this way to the social-economic development, not only by collecting taxes but also by facilitating trade as well.

This concept of providing an efficient level of given control, as added value, that facilitates and guarantees legitimate trade within the demand of the current international context, has been included into the Strategic Plan of the Federal Revenue Administration and constitutes one of its commitments.

In this regard, General Resolution 2977 of December 2010 modified the required conditions to give permission to shipping plants. It abolished the former RG1020 –which had been in force for a decade- and seeks to adapt the set of rules to the current operating and technological framework, as well as fostering export shipments at the production location of goods.

Cargo loading in warehouse or, otherwise, cargo loading at an authorized fiscal facility that fulfils the necessary requirements, will be compulsory for the export of goods that are difficult to control in the borders (bulk goods – liquid or solid-, those that need to maintain the cold chain or controlled atmosphere, those loaded in pressurized tanks or are chemical, toxic or hazardous products, or may require special processes for their handling).

It is important to mention that in order to comply with these requirements, authorized exporters may have to undergo some adaptation to comply with this regulation, so forth the requirement set forth under this regulation and published in the Official Gazette on December 3 2010, will be effective as of June 28 2011.

Implementation of introduced modifications The Federal Revenue Administration Office introduces, through the General resolution 2977 – Published in the Official Gazette on December 3 2010- amendments to the requirements for export cargo loading in plant.

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These amendments, especially those related to facilities and technological conditions, have generated a strong concern in the different sectors of the regional economies related to exports. Particularly, some exporters have expressed certain concern about certain aspects of the regulation since they claim are difficult or impossible to comply with due to economy restrains, limits as regards space availability and regional infrastructure services- all of which they think would be very difficult to adapt within the original term (before June 28 2011).

Taking into account the above mentioned, the Federal Revenue Administration Office decided to evaluate and amend certain aspects of the General Resolution. These possible amendments tend to achieve control goals without affecting the normal functioning of the international trade In this framework and continuing with a modern control policy and in conformity with best practices favoured by the World Customs Organization and based on, among other concepts, the cooperation between the Customs Administration and the Private Sector, last March 29 at the Escuela de Graduados en Ciencias Económicas was held the 8th Regional Customs Advisory Council meeting that involves Customs from the centre and northeast of the country. This meeting saw the participation of more than 35 organizations linked to the international trade that work in the provinces of Catamarca, Córdoba, La Rioja, Santiago del Estero and Tucumán, and they proposed some of the topics for discussion. Also present at this event was Mr Diego Nelli, Support Services Manager of Fundación ExportAr, who enriched this conference speaking of the services Fundación offers to exporters.

During the meeting of the Advisory Council, besides the presentation by Fundación ExportAr, other aspects of the General resolution 2977 were discussed since its implementation concerned exporters. This time, with the presence of the Assistant Manager for Inland Customs, after having heard different proposals from the sectors, the representatives of the administration expressed their willingness to save the points in conflict with the regulation before it comes into force.

Interview | Gustavo Mingone, Regional Customs Directorate of Córdoba

Export is made easier under due controls Gustavo Mignone, agricultural engineer, Director for Regional Customs Office Córdoba, is one of the most authorized voices to speak about the new regulation to make export logistics more dynamic.

Gustavo Mignone, agricultural engineer, Director for Regional Customs Office Córdoba, is one of the most authorized voices to speak about the new regulation to make more dynamic export logistics.

He explained that the amendments introduced to the concept of “exporter in plant” will facilitate tools that simplify the shipment of goods process without lacking due controls.

“As in every field, technological evolution in general and at international trade level in particular, has modified its scenario and made available to the public and private sectors new tools. The amendment of the requirements consists mainly of technological and communications aspects that permit to develop a more efficient risk management, to decentralize controls consequently with a better use of human resources.

In this way it can be facilitated, and following due customs controls, international trade in conformity with international trade requirements”, detailed Mignone.

What advice would you give to those companies that are starting the process of change to adopt it?

It is important that exporting companies see investment as added value to the exported product, since these processes assure the logistics chain guaranteeing the foreign buyer the traceability of goods. In addition, provides the exporter with an additional security element to avoid the use of legal shipments as a means for illegal shipments (drug trafficking, cultural artwork, etc).

What is the joint work performed between Fundación ExportAr and Customs in the region?

Though Customs is, mainly a control agency, the current international view places it as an agency capable of fostering international trade as well.

From this perspective, we share with Fundación ExportAr the same goal in order to achieve the best performance of national exports.

What does the Advisory Council do?

At international level, under the set of rules of the World Customs Organization (international reference advisory organization for worldwide customs) the Council has boosted the links Customs-Customs (mainly through the information exchange) and the Customs-Company one. Based on this latter link the Argentine Customs Office, under the current management of Ricardo Echegaray, has established different forums for the private sector and, since 2007, it has given Advisory Councils a federal turn that, up to that moment were only held in Buenos Aires. The current Director General, Symora Ayerán, has reinforced this trend. At regional level, advisory councils provide public and private members of the regional economies a direct channel of communication with customs authorities within a multisector environment of discussion, which also is a place to learn about the tools other State agencies offer to the Argentine international trade growth.

How do you think this new regulation will contribute in the short, medium and long term to Argentine exporting companies?

The scheme, as is, should be of benefit in the medium and long term as to the consolidation of shipments from productive areas. This will carry lower logistics cost of exports and, at the same time, a bigger economic development at regional level.

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Fundaci贸n ExportAr Agreement

Senasa at international exhibitions The National Service of Agrifood Health and Quality (Senasa) takes part in different national and international exhibitions, in order to give advice to exporters and importers of agrifood on phytosanitary requirements that the Argentine Republic and buyer countries of said products demand.

Under the agreement between Fundaci贸n ExportAr and Senasa, a decentralized organization of the Ministry of Agriculture, Livestock and Fisheries of the nation, during 2011 Senasa will participate in different fairs and exhibitions at national and international levels, to give advice to agrifood exporters and importers about phytosanitary requirements that the Argentine Republic and buyer countries demand of said products.

It is very common for the Senasa to show its activities in different national fairs. With this agreement the authorities of this organization decided to widen the scope and participate in well known international exhibitions related to the agrifood industry and contribute to the development of the international trade for these products.

The purpose of this agreement between the two organizations is to implement the necessary means and actions to reach a mutual technical complementation and carry out in a coordinated way projects in areas of mutual interest, working in cooperation through different activities.

In this regard, the Senasa and Fundaci贸n ExportAr jointly assist small and medium agrifood exporters abroad, as well as boosting imports, in matters related to quality and health in agrifood.

This joint work permits to collaborate in the design of the necessary conditions for the development of actions towards the fulfilment of the policies set forth by the national government as regards exports.

Thus the Senasa widens its regional scope by participating at these international meetings, adapting and accompanying its main goal that is to strengthen the role of the state on animal and vegetable health, food safety and environment care.

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For further information: www.senasa.gov.ar 0800-999-2386

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Seminar at Roque Saenz Peña

ExportAr support services in Chaco

Resistencia, Plaza 9 de julio

This time the meeting was at Roque Saenz Peña, province of Chaco. More than 200 people gathered at this new seminar organized by Fundación ExportAr, together with the Investment, International Trade, Foreign Affairs Agency and the representation of the host Province. Under the title “To export is to grow” the goal of this seminar was to provide technical support to small and medium enterprises in the process of becoming international and the development of competitive advantages.

The seminar was also attended by businessmen from nearby towns such as Pinedo,Charata, Las Breñas, Corzuela, San Bernardo, Pampa del Infierno, Santa Sylvina, Tres Isletas,General San Martín, Presidencia de la Plaza, Resistencia and Corrientes.

The following topics were of much interest for the participants: FOB price determination was discussed by Marcelo Wiñasky of Standard Bank Foundation; credit lines offered by Banco de la Nación Argentina; requirements for exhibition and sale of goods at international fairs; and electronic invoce process, all topics discussed by Sergio Carrazzoni (BNA International Trade Coordinator); Freddy Rosas Agurto, Maricel Díaz Coloderlo and Irma Ivalo of AFIP-DGA respectively.

tools to access these benefits.

Trade promotion tools and how to successfully participate in international fairs and business rounds was the core topic discussed by Lic. Sebastián Quintana, member of the Training Area of Fundación ExportAr. During the seminar, one topic of special interest was coal trade to Brazil. So forth, Fundación ExportAr will be providing interested persons with market reports, importers list, business opportunities and exports statistics. All of them are worthy tools for businessmen to start their exporting path on solid ground.

“They showed particular interest in taking part in Reverse Trade Missions, which are business rounds that are held in our country with foreign buyers. This is a worthy tool for them since it is low cost and can be a milestone in the progress of the company”, pointed out Quintana.

Export Pre-financing and financing were topics that captured the attention of the public since it poses many questions at the time of beginning an international experience. Speakers of Banco de la Nación, Standard Bank Foundation and ExportAr explained this issue thoroughly and showed current available News

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Financing of exports

by Lic. Javier Gonz谩lez Ojeda A. Article 1. Pre-financing of exports 2. Financing of exports

B. Interviews Fernando Pisauri, Standard Bank Juan Cruz Cabrera, Banco Provincia de Buenos Aires Roberto Righi, Banco de Inversi贸n y Comercio Exterior (BICE) Esteban Salvador Aira, Banco Naci贸n Enzo Martire, Banco Credicoop Adelmo Gabbi, Buenos Aires Stock Exchange News Virgilio Ted铆n Uriburu, Foreign Trade Specialist

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Financing of exports In a highly competitive world, access to suitable financing is fundamental in obtaining good export results.

This section will analyse existing credit lines for financing exports, designed to satisfy specific needs that may arise in export activity.

Once a firm purchase order has been received, the need for financing may arise before the goods are shipped (pre-financing of exports), or once the goods have been manufactured so as to compete effectively with attractive credit conditions (strictly speaking post-financing of exports or financing of exports).

The legal framework for the pre-financing of exports is set by the Banco Central de la República Argentina (BCRA - Argentinas Central Bank) by means of Communications “A” 44431 and complementary documents2, which establish the conditions and requirements for receiving advance payments in foreign currency or for gaining credit to pre-finance exports.

Likewise, post-financing of exports is included in Communications “A” 44043, which specify that in the case of capital goods, goods with a high technological component and exports classified under Decree 870/03 (formerly 690/02) of turn-key exports, the exporter and importer can agree on a period longer than that set by the Secretariat of Industry, Trade and of Small and Medium Enterprises. In addition, Communication “A” 46414 stipulates that this period can be extended when dealing with operations financed by a local credit agency.

1. Pre-financing of exports

Pre-financing of exports is a loan in foreign currency granted prior to shipment of the goods to be exported which is used to finance the production process.

Communication “A”4443 of the BCRA states that when the Argentine exporter requires capital to finance the production process of goods for export, he can choose to:

a) Receive advance payments from his clients abroad, or b) Request a loan from a local bank to pre-finance his exports.

The first case would be in the form of a deposit by the importer/buyer, and the second a loan granted by the national bank. In both cases, a debt of these characteristics is conditioned by the making of shipments to a specific destination, and it must be clearly stated in the pre-financing contract that the debt will be considered settled with actual export, to either a specific market or client. In this regard, for the BCRA, the advance payments from clients and the pre-financing of exports must be settled with the foreign currency received from export payments with the date of shipment.

To ensure the correct payment of exports, the BCRA establishes that the body designated to follow up the advance payment or pre-financing must inform it as to the state of each operation in compliance with the periods given to obtain the shipping permit, according to the purchase orders or contracts that validate said indebtedness.

1 Communication BCRA of 22 November 2005 2 The BCRA issues 4 kinds of communications: “A”: on regulatory issues of a permanent nature; “B”: on regulatory aspects of a transitory or circumstantial nature; “C”: of an informative or rectificatory nature; “P”: press releases.

3 Communication BCRA of 16 August 2005 4 Communication BCRA of 15 March 2007.

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The lines of credit established for the pre-financing of exports serve to finance the production of manufactures and the import of inputs for manufactures of industrial and agricultural origin destined for export.

Credit provides the exporter with financial resources so that he may complete the various phases of the production and commercialization process of the goods to be exported, making it an incentive to export.

This instrument enables the exporter to finance loans in United States dollars for up to 80% of the FOB value of agricultural products for a period of up to 180 days, which in certain circumstances can reach 270 days, depending on the production cycle.

As regards the industrial and mining sector, the maximum periods offered in the market can reach 180 days, and exceptionally 365 days, when dealing with exports of capital goods or those with a strong technological component.

The conditions set by the Banco Nación for access to these loans are: Agricultural sector - Irrevocable documentary credit opened in favor of the exporter; or firm purchase contract or order.

- Confirmation of the transaction by the intervening broker or by the buyer, stating in the communication received that the destination of the merchandise is export.

Industrial and mining sector - Irrevocable documentary credit opened in his favor; or - Firm purchase contract or order.

In the case of exports of capital or technological goods, and a turn-key export régime, Communication “A” 4404 of the BCRA allows the exporter to agree with the importer on a period longer than that established by the Secretariat of Industry, Trade and of Small and Medium Enterprises, as long as the operation is done through a Reciprocal Credit Agreement of the ALADI (Latin American Integration Association) or with guarantee from a bank abroad, and the financing of the FOB value of the export should be for a period of no more than six years from the date of shipping.

2. Post-financing of exports

Likewise, by virtue of BCRA Communication “A” 4641 this period may be extended for operations that have financing from a local financial body, for the period of duration of said financing.

The financing of exports allows the Argentine exporter to offer the importer facilities for the payment of purchases. In this regard, the financing of exports benefits the Argentine exporter who can sell in installments in markets abroad and collect in cash. The advantage of the system is that while the importer pays in installments, the exporter receives payment for the entire operation.

This seeks to favor the competitiveness of Argentine products, especially capital goods and contracts under the turn-key system (in accordance with Decree 870/036), although goods in general are not excluded from the benefit as long as they respect the maximum period of entry of currency.

Export financing operations may be: - With recourse, when the client’s credit margin is affected, insofar as the exporter stands as loan guarantor. So in the event that the currency fails to appear, the exporter must return the funds to the bank.

- WIthout recourse when the client’s credit margin is unaffected, the lending bank renounces to exercise its right against the exporter.

The most common operation of the export financing system requires that the exporter agree by means of a contract the sales terms of the goods or service. They may be a percentage in cash against delivery and the remaining amount can be financed in a certain period through the issuing of bills of exchange by the exporter to himself, which will be accepted by the importer and endorsed by a leading bank in the importer’s country. Once the operation has been agreed and the bills of exchange 5 Takes effect after shipment of the merchandise.

6 Replaces decree 690/02

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ratified, the bank will discount them from the exporter and will hand over the money.

For capital goods and turn-key contracts, financing may cover 100% of the exported good and also up to 10% of the FOB value of the spare parts and accessories and for a maximum period of 5 years.

As regards the financing of exports of durable goods, it can cover up to 100% and the maximum period is 360 days or up to the maximum limit from the entry of foreign currency according to regulations.

The conditions imposed by the Banco Nación for access to these credits are:

For the export of capital goods and turn-key contracts - Export credit insurance covering extraordinary risks.

- Endorsement of the bills of exchange by a foreign bank that meets with Banco Nación approval or by an institution authorized to operate through Reciprocal Credit and Payments Agreement, endorsed in favor of the Banco Nación.

For the short-term export of goods in general (including durable consumer goods): - Negotiated bill of lading in order.

- Endorsement of the bills of exchange or transfer of rights of encashment of the instruments of payment, as appropriate, of an institution authorized to operate through Payment Agreements, without recourse (i.e., which do not affect the client’s credit margin).

- For operations with recourse (which affect the client’s credit margin), guarantees can also be requested from an institution authorized to operate through Payment Agreements, and additional ones that meet with Banco Nación approval.

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Bibliography

Foreign trade Support Programme (Programa de Apoyo al Comercio Exterior, PDCEX); “Incentivos para la Exportación de Bienes de Capital”; 2010; at www. argentinatradenet.gov.ar Moori Koenig, Virginia; “Algunas características del financiamiento bancario a las exportaciones de PYMES industriales”; Working Document Nº 75; ECLAC, Bs. As. Office BICE; “Cómo venderle al mundo”; Chapter 11, Financiación de Exportaciones y seguro de crédito a la exportación; at www.bice.com.ar Proargentina; “Instrumentos financieros vinculados a la exportación” at www. proargentina.gov.ar

Banco Central Documents

Communication A 4851 (16/10/2008) Communication A 4015 (19/09/2003) Communication A 4443 (22/11/2005) Communication A 4404 (16/08/2005) Communication A 4641 (15/03/2007)

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Interview | Fernando Pisauri, Standard Bank

“This is a Bank that wants to keep a clear exporting profile�

Fernando Pisauri works in Banking Operations of Foreign Trade and Domestic Transactional Banking of the Standard Bank.

He specializes in Financial Regimes of Exports Promotion and Limitations to the Free Circulation of Capitals.

What is the role of the Standard Bank in International Trade?

Among the attributes that make Standard Bank a well-known bank in the business market, its active role in the international sphere is highlighted with emphasis on:

- Working on the uncertainty of the operator of international trade due to typical risks of the field: political risk, transferability risk, commercial risk, general issues of foreign trade architecture, etc.

- Working on the identification of work capital needs to ensure a proper flow of funds when starting doing sales beyond national boundaries.

-Working on the reasons behind the regulations of the Single Free Exchange Market (MULC) and working on the actions that international trade representatives have to take in order to comply with the regulatory framework and on how to do it.

Said issues work as connection factors between the Standard Bank and its customers and represent their main concern when studying the financial feasibility to develop an external market and considering if the profit margin with all the expenses and risks inherent to the transaction is sustainable.

In this sense, the Standard Bank has a group of businessmen with presence in the 98 branches of the entity throughout country, plus the support of technical operators experienced in the field. Likewise, client attention is completed with the permanent and personalized counseling of a team of people specialized in international trade who are available for customers, both in Buenos Aires, as well as in the different locations throughout the country, namely: interior of Buenos Aires, Rosario, Santa Fe, Mendoza, Cordoba, North Western region and North Eastern region. The employees of transactional banking and foreign trade advice customers of the Standard Bank focused on the flow of funds of a company, i.e. solutions to make domestic and international charges and payments more efficient within the regulatory framework and financial requirements in force.

What are the main lines of credit that the Standard Bank offers for export financing?

With regards to financing, the Standard Bank has the following lines:

Export financing - Pre-financing of Exports.

- Post-financing of Exports.

- Financing of Agricultural Producers.

- Financing of International Services.

- Export Forfaiting or Discount of External Assets (Letters of Credit and Guaranteed Bills).

Import financing (supplies for production) The bank has many years of experience in the design of financing products to meet the specific needs of SMEs and Corporate customers with a wide network system of correspondent banks in different strategic places around the world, so that they would reach practically all markets.

It should be noted that the Standard Bank is leader in Hedging Solutions and it advises customers regarding their undermined external debt when they have to cover against Exchange Rate fluctuations. The highlighted product here is known as NDF (Non Delivery Forward). For that, it gives advice through their business employees, transactional banking and treasury operations specialists.

Which sectors are export credits mainly aimed at or what is the main sector demand that the Standard Bank takes care of?

Besides export financing credits, the Standard Bank also focuses on every stage of a company; whether it is an Exporting SME, a Multinational, or a Transnational company, offering customized products for each particular case. Credits are aimed at a wide range of sectors, among them:

- Small, Medium and Large Industrial Exporting Enterprises.

- Small, Medium and Large Commercial Exporting Enterprises.

- Agribusiness sector both at the level of agricultural products as well as companies related with the activity (Agricultural Machinery, Grain Traders, Wine Sector, etc.).

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What are the steps that a SME should follow in order to access credits for pre-financing and financing exports?

Have a purchase order, commercial invoices, order form, contract, etc. that proves that an international contract for the sale of goods has been executed by two parties whose centers of operation are in different countries. From that document, the business employee or the foreign trade specialist will be able to determine the amount to be financed, shipping deadlines, deadlines for the collection of the goods, etc, in order to define the maximum term to be financed under this diagram.

We shall point out that, pre-financing and financing of exports, even though they constitute a financing method of foreign trade widely disseminated in the field, require much more follow-up because the loans are granted in foreign currency (Argendollars), and the current regulation is very exhaustive with respect to the way of implementing them, deadlines and formal requirements.

In addition to the review of all documents, the company interested in accessing this type of financing shall prove its credit rating, and then go and talk to a business employee at the closest Standard Bank branch, among the 98 branches of the Network.

The only case in which it is not necessary to rate the customer is when the discount of external assets (letters of credit or guaranteed bills by other banks) risk taken is against a foreign bank, and not as in most cases when the transaction is without recourse to the Argentine Exporter.

In summary, the steps to be followed would be: 1) Contact a business employee from the closest branch to tell him about the financing need; 2) Through the business employee, the company will have personalized counseling from Transactional Bank and Foreign Trade specialists.

What has been the evolution, in the last years, of the lines of credit offered by the Standard Bank?

The bank has gone along with the growth of exports with specific lines for that purpose.

Standard Bank will proactively keep going along with their customers financing needs in a more and more competitive world, where having a proper economic and financial architecture, is decisive when aiming at international commercial expansion.

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Interview | Juan Cruz Cabrera, Banco Provincia de Buenos Aires

“We accompany SMEs along the complete exporting process providing quality services and credits at competitive rates”

What is the role of Banco Provincia in international trade?

We have a wide scope to help exporters. In this sense, in the bank we have been able to develop a sufficiently flexible and dynamic structure to give operating support for SMEs that trade in COMEX, by providing the lowest cost in the market and higher quality services as well as advice to companies in their first steps in COMEX, especially on “First time exporting”.

Besides traditional financing support, SMEs can come to the bank and request market reports for positioning their products abroad, seek foreign counterparties, arrange of trade missions, finance, and advice on participation at international fairs and exhibitions.

What are the main credit lines that Banco Provincia offers for financing exports?

Though a thorough detail of credit lines is extensive, in order to make a summary we can highlight the following: pre-financing, financing, and purchase without recourse (on board product)

What is the evolution, in the past years, of credit lines offered by the Banco Provincia?

Juan Cruz Cabrera has vast experience in international trade, and tells us about financing opportunities the Banco Provincia offers exporting SMEs.

Credit lines for export have reached an outstanding increase in accordance with the productive and exporting development of the province and the country. In this regard, it is important to mention that even though the demand for credit decreased in 2009, due to the world crisis, it can be observed a rapid recovery from 2010 reaching the levels prior to the crisis.

What are future projects the bank is working on currently?

Basically, in regards to the Banco Provincia our goal is to offer a wide variety of services to exporters at low cost. Today the bank is devoted to enlarging our clients portfolio and boosting the existing potential of clients related to the Banco Provincia de Buenos Aires that transact in COMEX. In this sense, and as regards our current clients, the idea is it to commercially develop those clients already in the bank and survey their loyalty in this business segment.

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Interview | Dr. Roberto Righi Banco de InversiĂłn y Comercio Exterior (BICE)

“With a wide financing line we help Argentine companies to be competitive in the world�

Roberto Righi is a lwayer. He has worked for First Instance Courts in Commercial Matters, and in various financial institutions and insurance companies in the public and private sector respectively.

Today he is the Director of BICE.

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What is the role of BICE in international trade?

The idea of the Bank is to prop the exporting effort and go along with the sale of our products to the world. Thus, the beneficiaries of these are productive sectors, exporters, manufacturers and service providers in general. Our funding lines are wide and destined to primary products export, and industry and agricultural manufactures as well.

The last year export funding reach almost 30% of the total spending of the institution.

Which are the main credit lines that the BICE offers for financing exports?

The main credit lines the bank offers are the following:

a)Pre-financing It is a credit line in US dollars in order to advance resources for the export of goods and services. It finances 75% of the FOB value of the export or the amount of services and has an average term of 180 days. Nominal interest rate 3.5%.

Effective interest rate 3.56%. It is important to note that the above mentioned is subject to the credit soundness profile and guarantees that can be offered by the applicant and are good enough to abide legal requirements. b) Post-financing: This is a line in US dollars destined to finance up to 100% of the FOB value of the export of consumer durables and capital goods, Argentine origin services, and turnkey projects.

Which exporting sectors are these credit lines mainly designed for?

Currently there are 65 companies that have international trade credit lines with the Bank. The sectors to which the assistance is destined to are: plastics, wines, metalworking industry, autoparts, food, chemicals, fresh fruits, agricultural machinery, peanut, laboratories, and wool.

For us, international trade financing will continue to be one of our first concerns even though when the Bank puts the attention to long term investments financing.

Interview | Esteban S. Aira, Banco Nación

“In 2010 we surpassed the historic highs of volumes of loans to exporters, and in 2011 we are keeping that favorable trend”

What’s the role of Banco Nación in International trade?

The BNA fosters and supports Foreign Trade, and it especially stimulates exports of goods, services, and Argentine technology, doing everything necessary in order to achieve growth of said trade.

What are the main lines of credit that Banco Nación offers for export financing?

Banco de la Nación Argentina (BNA) pays close attention to the activity of the exporting sector. Our strategy is to be present in all the stages of the production and marketing process abroad offering both pre and post shipping credits, as well as loans to finance the attendance of companies to international fairs and/or exhibitions.

On the one hand the BNA has a Pre-financing Regime of exports aimed at final exporters of the agricultural, industrial and mining sectors. These credits are earmarked for the financing of the necessary working capital for the purchase of raw material, inputs and services, to be used in the process of production and fitting out of the goods assigned for foreign markets.

It’s worth pointing out that the financial support can reach up to 80% of the FOB value of the future exportation and that the term for financing is up to 180 days.

As regards to post-shipping credits, we specialize in financing Argentine exports of capital goods and goods in general. It could be short, medium and long term financing, depending on the type of good to be exported. In this way, the exporter sells on a fixed term and receives payment in cash of his export. This is an instrument under the method “supplier credit”.

Esteban Aira, Departmental Manager of International Banking, has significant experience in Banco Nación supporting SMEs and the exporting sector.

If we talk about Capital Goods and turnkey exports Contracts, the BNA is the main bank in the market that has a line that allows the financing of these types of goods up to a 5-year term, at a fixed interest rate of 6.5% annual nominal, whenever dealing with exports to the ALADI member countries and as long as transactions are implemented through the mechanisms of Reciprocal Payments and Credits Agreement subscribed by the BCRA. In these cases, the support reaches up to 100% of the FOB or FCA value of the exported capital good.

For the case of Goods in general, the BNA buys the 100% of the value of the shipping documents with terms that do not exceed 360 days. The applicable rate interest shall be determined in each case and shall vary depending on whether the transaction is implemented with or without recourse towards the exporter. We also have special financial conditions that could be translated into better terms and interest rates for the case of consumer goods and exports of autoparts.

We also offer exporters the line of credit known as “Financing to Exporting Companies”, aimed at financing working capital, investments and/or acquisition of all type of goods, including temporary importation of inputs, related to the production of goods to be exported or that allow the increase of production of exportable goods.

We also facilitate the external commercial promotion of companies; that’s why the BNA has a line of credit to finance the participation of exporters and/or producers in trade shows, exhibitions or specialized international fairs included in the calendar of the Argentina’s Official Participation in Trade shows and International Exhibitions Abroad. The expenses to be financed shall cover the stand rental, its design and installation, rental of audiovisual equipment, catalog and dissemination material expenses, the freight and the insurance of elements to be exhibited, and tickets and accommodation of participants. The proportion of the support is up to 70% of the expenses above mentioned, with a maximum of $60,000 per beneficiary and per show.

The applicable interest rate is the General Portfolio Rate in Pesos and the financing term reaches up to 2 years, as from the moment of the disbursement.

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What has been the evolution, in the last years, of the lines of credit offered by Banco Naci贸n?

There had been great growth in loans volumes to the private sector until the 2008 crisis. Companies began to transform their portfolios faced with the change of the external scenario, which was demanding their export products. The market slowly returned to normal and we are now in a position to say that we have overcome that fall and we are in loan volumes that exceed historic highs with favorable prospect for their evolution.

What are the future prospects?

The future prospects are to keep going along the growth of the country and favoring a greater involvement of the Bank in the financial market in regards to Foreign Trade.

The BNA is actively involved in the development of the biggest development and infrastructure projects of the country.

Pre-financing of Exports Sector

Financing

Term

Guarantee

Settlement in both cases:

AGRICULTURE: Exporters

Up to 80% of FOB value

Up to 180 days (1)

Upon bank demand

A. Upon payment of sale done, under the maximum term agreed on; or

INDUSTRY AND MINING: Exporters

Up to 80% of FOB value

Up to 180 days (2)

Upon bank demand

B. At the moment the bank formally grants an eventual financing of exports.

(1) Exclusively for exporter manufacturers in special cases up to 270 days.

(2) Exclusively for capital goods in special cases up to 1 year.

Source: BNA

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.

Financing of Exports

capital goods

By irrevocable documentary credit or insurde by financial authorised entities the Reciprocal Payments and Credit Agreement of ALADI with automatic reimbursement code

durable goods

automobiles

Autoparts Sector: Up to 18 months

By irrevocable documentary credit or insurde by financial authorised entities the Reciprocal Payments and Credit Agreement of ALADI with automatic reimbursement code

Source: BNA

Financing of exporting companies

Source: BNA

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Interview | Enzo Martire , Banco Credicoop

“We specialize in SMEs, holding a preeminent position in international trade”

Enzo Martire is manager of foreign matters of Banco Credicoop and Secretary of the Commission of Foreign Trade and Exchange of the ABAPPRA (Association of Public and Private Banks of the Argentine Republic).

What’s the role of the Banco Credicoop in international trade?

Banco Credicoop holds a pre-eminent position in foreign trade. In fact, according to statistics of the BCRA, Credicoop is the number one bank in terms of the amount of import transactions and the number two in terms of the amount of export transactions.

This indicates that we are a very active institution in this field, offering excellent services both to our associated exporting companies as well as their importing companies, with custom-made products, favorable lines of credit and proper costs and a network of over three hundred correspondents in the world who guarantee the efficiency of services.

What are the main lines of credit that the Bank Credicoop offers for export financing?

Nowadays, the lines affected to pre-financing and financing of exports come from deposits in US dollars that the Bank attracts- pursuant to the current regulations of the BCRA- with rates more favorable than the international ones-. -Furthermore, we offer a line for financing capital goods with a term up to three years.

Banco Credicoop specializes in the SMEs segment. Therefore, it’s hard to mention a specific area, provided that –as it is well known- national small and medium enterprises can be found in many different industries. Nonetheless, we can highlight as significant activity areas the industries of wine, leather and autoparts.

What has been the evolution, in the last years, of the lines of credit offered by the Banco Credicoop?

The evolution of the lines of credit offered by Credicoop is extremely favorable.

We see the demand growing year after year. As an example, we can mention that the portfolio of these loans during the current year logs about 35% more than the previous year.

What are the future prospects?

We feel that the growth prospects are very good. The evolution and transformation of the Argentina SMEs in the last decade is remarkable. During this period, we have helped the national small and medium enterprises in the adaptation process, and they are now prepared and have professionalized their general performance in order to position their product abroad and access new markets, in a way that is sustainable over time.

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Interview | Adelmo Gabbi, Buenos Aires Stock Market

“The stock market can finance from drawing a check to capital issue that is practically a long term loan”

Which are the possibilities the stock market offer exporting SMEs? There are a lot of possibilities. It is important to understand that the stock market represents not only long term financing but also the investment in the economy of a country.

As we always say in our institution, transform families’ savings into productive investment for companies to grow and employ families once their savings keep up with the virtuous circle.

The exporting sector represents one of the most formal sectors, with the most transparency in a world that is becoming every time more interrelated and is constantly growing. In addition, it is one of the most important money exchange actors and so forth the best partner for investors to channel their savings.

The stock market can finance from drawing a company check, at a very short term, or finance capital issue of the company almost as a perpetual loan.

In this interview, the president of the Buenos Aires Stock Market describes the possibilities that exporting SMEs have to finance themselves through the stock market.

What are the tools that the Stock Market offers for financing exports?

Surely we offer more tools than those ones companies already know. For example, from the most simple one as drawing a company check, also a company check if it is a SME guaranteed by a reciprocal guarantee company, company’s bonds, short term assets, finance trust of physical assets or future flows that the company may produce, to turning liquid assets the company may have today into liquid and fundable assets, in fact over 50 % of trusts that quote publically belong to the exporting sector. And why not capital issue too.

In your opinion, what are the steps a company should follow to obtain financing through the stock market?

The first step is coming to the Buenos Aires Stock Market, where we have a trade division willing to study each case in particular at no cost for companies, only to study the feasibility of each tool. We have a SME division that offers not only financing but also helps in the follow up of each one. The capital market, through the Buenos Aires Stock Market, is every day closer to the real economy and productive investment financing of the country.

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Interview | Virgilio Tedín Uriburu, Foreign Trade Spacialist

“To the financing role of banks in foreign trade, we have to add that of Financial Trust, that of factoring companies and Insurance companies”

Virgilio Tedín Uriburu as a distinguished expert in foreign trade and financial system provides us with a detailed analysis about the tools that the market offers for export financing.

What’s the role of the Central Bank in facilitating the foreign trade and more specifically in making the export financing possible?

In a globalized world, where 40% of the foreign trade is related with value chains made up of links that end up in a final product, the promotion of trade and the guarantee of its financing have become a priority for governments. The recent crisis of Lehamn Brothers is an example of this concern. The strong fall of the global trade led countries and credit multilateral bodies like the World Bank to design specific means that would replace the fall of the traditional financing of banks.

This concern of governments for facilitating commerce does not only take place in cases of crisis. Most developed and developing countries have created specialized institutions, like development banks or exports credit agencies that have the purpose of fostering exports.

Central banks are not an exception to this rule. Traditionally, they have had an outstanding role in financing foreign trade transactions either through the promotion of private credits by means of rediscounts of documentary credits owned by the private banking or, in times of crisis, through liquidity provision, or leading to the falling of interest rates. However, in the case of the Central Bank of the Argentine Republic, the modification of the organic act of the year 1992 prevented it from financing or awarding rediscounts to banks against the credit portfolios except in liquidity situations that limit their actions to facilitate international trade. As a result of these limitations, the government has tried to find alternatives that foster credit for investments like the Bicentenary Fund.

The crisis that Argentina suffered in the year 2001 forced the end of the convertibility, led the government to establish a regime of exchange controls –under Decree 260 of the year 2002 and the Notification 3473 of the BCRA, which basically compels companies and banks to negotiate currencies through the Single Free Exchange.

These obligations, which are also applicable to foreign trade transactions, force companies to assign a bank for the follow-up and negotiation of payments and collections abroad.

These mechanisms are framed in a series of regulations and communications of the BCRA that can be found on the web page. To these regulations, the ones related to the financing of foreign trade were added through different releases of Credit Policies that in essence, allow financing of currencies by using deposits in dollars, with their own funds through foreign borrowing as long as there is a foreign trade transaction on the base of the transactions.

Faced with these limitations imposed by the founding charter, the BCRA has designed two instruments related to foreign trade transactions. On the one hand, through the Reciprocal Payments And Credits Agreement of the ALADI; the financing of the companies of member countries is allowed- through local banks authorized in the system- to different terms and with the guarantees of Central Banks. This means that, if an Argentine exporter sells to a customer of a country from the ALADI and finances his exports to the buyer by means of the discount of a bill of exchange endorsed by a bank from the importing country, the guarantee of this operation lies as a last resort, on the Central Bank. So there is no transaction risk. This system, which has already been in force for some years, is, however, still rarely used by Argentine banks or by Argentine exporters, so it is important to make it widely known. In this way, the BCRA has kept a series of consultations with the commercial banking to foster its use.

Another implementation by the BCRA that is used for facilitating foreign trade is the SML (Local Currency Payment System) with Brazil, which allows an Argentine exporter to pay and receive payments in pesos, leaving the compensation of currencies in charge of the respective central banks. The system facilitates exports by fixing the price at a local currency and avoiding the variations of the exchange rate, besides reducing bank commissions. This system was established in October and its

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use has been increasing.

Who are the main players that intervene in exports financing?

There are many reports from the BCRA that could serve to have an idea of what the role of banks in foreign trade financing is. The most useful ones are: Ranking of entities of the volume operated in the Single Free Exchange Market and the Report about private Debt.

The first one indicates which the most important banks are and what they are doing besides giving an idea of the volume and amount of transactions of foreign trade. Chart I details the main banks until the third quarter of 2010.

As it can be observed, the CITY AND HSBS are by far the ones that better negotiate exports expenses, which indicates that they mainly operate with big companies, and most likely, in the negotiation of currencies for exports of big export industries.

Chart II, complementary to the former one, details which are the banks assigned by exporters for the negotiation of currencies. As it is known, pursuant to the regulation of the BCRA, in order to negotiate currencies resulting from foreign trade transactions, the companies must assign a bank that will be in charge of followingup transactions. As it can be observed, the Bank Credicoop is the one that has the largest clientele but as opposed to the abovementioned banks, its clientele is composed basically of Small and Medium Exporting Enterprises.

The other interesting report is the one about Private Foreign Debt.

The last report issued has figures up to the third quarter of 2010.

According to said report, the private debt until the second semester of 2010 for advances and pre-financing was of USD 6,228 billion or 8% of estimated exports for the following 12 months.

There are other instruments or entities that have the purpose of facilitating foreign trade financing. Financial Trusts, both public and private, are playing a more and more important role. Factoring companies are growing, even though they do not have an important involvement in foreign trade; and Insurance companies play an important role at an international level but still with little relevance in Argentina. Internationally, these companies nowadays guarantee 10% of total commerce, which facilitates bank financing and reduces the risk of exporters.

Chart I Collection of goods exports by entity.

Banks and Financial Entities -in USDEntity

III quarter 2010 Participation in % III Quarter

Citibank N.A.

3,473.5

19.271 17.218

HSBC Bank Argentina S.A.

3,103.6

Banco de Galicia y Buenos Aires S.A.

1,546.4

8.579

Banco Santander Río S.A.

1,521.1

8.439

1,340.6

7.438 5.432

Standard Bank Argentina S.A. BBVA Banco Francés S.A.

979.0

BNP Paribas

924.9

5.132

Banco de la Nación Argentina

885.0

4.910

Nuevo Banco Industrial de Azul S.A.

687.9

4.910

Banco Credicoop Cooperativo Limitado Total all banks

478.6

2.655

18,942.4

100.00

Source: BCRA

Chart II Communication “A” 3493. Number of exporters that have designated the entity Entity

I quarter 2010

Banco Credicoop Cooperativo Limitado

1,566

Banco de Galicia y Buenos Aires S.A. Banco Santander Río S.A.

II quarter 2010

III quarter 2010

1,673

1,640

1,079

1,132

1,164

1,076

1,158

1,149

BBVA Banco Francés S.A.

1,040

1,069

1,042

Banco de la Nación Argentina

1,019

1,045

1,024

HSBC Bank Argentina S.A.

835

829

826

Standard Bank Argentina S.A.

578

618

588

Banco Macro S.A.

417

449

456

Banco Patagonia S.A.

371

386

385

Banco de la Provincia de Buenos Aires

333

332

326

Citibank N.A.

311

316

317

8,359

8,704

8,490

Total exporters Source: BCRA

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Additionally, governments have established a series of entities or specific agencies like Export-Import Banks, Export Credit Insurance Agencies or other entities like the Brazilian Development Bank (BNDES) to facilitate the foreign trade financing. In Argentina, apart from the BICE, the Banco Nación, with its network of branches in the interior of the country and abroad, plays an important role in fostering foreign trade.

The following chart details pre financing, term and distiction between domestic or foreing

Export financing - II quarter 2010 - Main sectors in million dollars

4500 9,09

4000 3500

7,49

3000 2500 4,54

2000 1500 1000

2,82

500 0 Automobile industry

Food, beverages and tobbaco

Exports according to average life Advances earnings and local pre-financing Average life of the quarter financing (in months)

Oil

Chemicals

Advances earnings foreign pre-financing Foreing debt stock

Source: BCRA

What are the regulations that companies must be aware of regarding foreign trade financing?

As I pointed out above, there are many regulations related to the income and outcome of currencies, including foreign trade transactions. A summary of the regulations can be found on the Communication Number 49872 from 05/31/2011, “Summary of current regulations by the end of the month of April of 2011 regarding foreign trade and exchange.”

In general, regulations are aimed at the commercial banking system rather than companies. What I do think it’s important for the latter to be aware of the deadlines that they shall meet for the liquidation of currencies for exports that depend on the type of product and vary from 60 to 360 days (Resolution Nº 120/2003 of the ex SICM and Nº 246/09 of the SICyPyme) and the obligation of the income of currencies of exports collections. Upon preparing the shipping, a financial entity shall be assigned to do the follow-up according to the option chosen by the exporter. The completion of the shipping can only be granted by the financial entity assigned by the exporter. When dealing with pre-financing of exports resulting

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from other countries, the Communication “A” 4443 and similar ones made public the applicable regulations for the income and liquidation of advances and pre-financing of exports. The rules establish the requirements to be able to consider incomes of funds by the local exchange market under these concepts.

Regarding exports of services, there is an obligation to settle in the stock market the exports of services for 100% of the exact net amount received in foreign currency, based on net withholdings done abroad paid by the customer (Communications “A” 3473 and “C”39547). The regulation comprises all exports of services rendered by residents to non-residents.

The incomes resulting from services rendered to non-residents have 15 business days to be liquidated, which are counted from the collection date abroad or in the country, or upon its accreditation in foreign accounts (Communication “A” 4860).

Entre Ríos Special Report

Part 2

by Santiago Mantelli Martín Poggi Lic. María Leticia Sandoval Lic. Sebastián Fratto Agustín Bozzotti Area of Commercial Intelligence

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Entre RĂ­os

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Analysis of exports from the Province of Entre Ríos Entre Ríos: trade in perspective 6 As mentioned in the previous section, during 2009 the province of Entre Ríos exported products to a FOB value of USD 959.8 million, representing a 1.7% share of Argentina’s international sales.

Although full data for 2010 were unavailable, for the first ten months of the year, exports by the province exceeded USD 958.7 million. The leading products exported were from a variety of industries and were mainly shipped to the countries shown in chart Nº8.

6 Sources: “Industry Forecast Scenario: Russia” - Q1 2011 Business Monitor International - www.businessmonitor.com “Industry Forecast Scenario: China” - Q1 2011 Business Monitor International - www.businessmonitor.com

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Main products of Entre Ríos export offer | First ten months of 2010.

Industry

Poultry

Vegetable

Rice

Pharmaceutical products

HS Code 0207.12.00 0207.14.00 0505.90.00 1602.32.00 2301.10.90 0210.99.00 0408.91.00 0408.99.00 0805.20.00 0805.10.00 0810.40.00 2009.39.00 0805.50.00 0805.40.00 1006.30.21 1006.10.92 1006.20.20 1006.40.00 1006.10.10 1006.30.11 3004.39.19 3003.39.19 3004.90.59

Forestal

3004.90.99 3002.30.80 3002.30.70 4411.14.90 4410.11.29 4411.13.99 4411.14.10 4411.12.90 4403.99.00 4411.12.90 4411.12.10

Natural Honey

9403.40.00 0409.00.00 1521.90.11

Generic description

USD FOB

Meat and edible meat offal of the poultry, not cut in pieces, frozen Poultry cuts and offal, frozen Skins and other parts of birds with their feathers,powder and waste Poultry prepared and preserved meat Other chicken flour,powder and pellets Meat and edible meat offal,salted, in brine, dried or smoked,edible flours of meat or meat offal Bird’s eggs not in shell Bird’s eggs not in shell,other Mandarins Oranges Bilberries and myrtillus Citrus fruit juices Lemons Grapefruit, including pomelos Semi-milled or wholly milled rice, non parboiled, polished and glazed Rice in the husk (paddy), non parboiled Husked rice, non parboiled Broken rice Rice in the husk (paddy) Semi-milled or wholly rice, parboiled, polished and glazed Medicaments put up in measured doses, containing polypeptide or protein, in the form of transdermal administration for retail sale Medicaments not put up in measured doses, containing polypetide or protein, not for retail sale Medicaments containing products of heading 2930 to 2932, not containing products of heading 3004901 to 3004904 Medicaments for retail sales Vaccines for veterinary medicine Lyophilisate vaccines Fibreboard of wood of a thickness exceeding 9 mm Fibreboard of wood with melamine-impregnated Medium density fibreboard of a thickness exceeding 5mm but not exceeding 9 mm Fibreboard of a thickness exceeding 9 mm, not mechanically worked or surface covered Fibreboards of a thickness not exceeding 5 mm Wood in the rough, stripped of bark Medium density fibreboard of a thickness exceeding 5mm but not exceeding 9 mm, not mechanically worked or surface covered Medium density fibreboard of a thickness not exceeding 5 mm, not mechanically worked or surface covered Wooden furniture of a kind used in the kitchen Natural honey Beeswax

Other* Las demás*

Source: Fundación ExportAr data based on info-just and the government of the province of Entre Ríos *Including soya beans (USD 179.5 millions)

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Total

85,606.738 84,474.523 3,549.626 3,000.322 2.352,236 1,283,883 470.887 263.520 59,595.591 31,622.548 8,109.802 3,601.833 2,412.267 223.701 52,841.109 15,079.879 11,712.630 7,564.595 1,803.712 266.073 3,405.231 2,652.356 753.648 562.953 182.428 82.354 20,277.768 8,526.485 3,613.854 2,313.473 1,875.971 1,191.041 1,031.596 1,029.983 997.083 12,609.650 229.985 521,686.549 958.775.529

However, it should be mentioned that in previous years operations included other items, such as:

- - - - - - - - - - - - -

0207.11.00, Chicken whole, offal, refrigerated.

0207.13.90, Chicken pieces, frozen.

4407.99.90, Eucalyptus sawdust.

2106.90.30, Iron, folic acid, calcium, boldine, oleo-calcareous liniment for human use.

3004.90.39, Salbutamol, for human use.

3004.90.43, Lidocaine, local anaesthetic for human use.

3004.90.46, Cypermethrin, insecticide, repellent, external antiparasitic, for veterinary use.

3004.90.62, Fenbendazole, for veterinary use.

3004.90.63, Albendazole or its sulfoxide. Antiparasitic, for veterinary use 3004.90.67, Nicarbazin, for veterinary use.

3004.90.69, Cinnarizine, cerebral vasodilator for human use.

3004.90.71, Levamisole or its salts, for veterinary use.

3808.94.19, Water disinfectant.

In 2010, the abovementioned products reported movements of under USD 100,000, or were not sold abroad. However, in previous years they reported exports for sums that did not represent a competitive exportable supply either

Main exports destinations from Entre Rios. In FOB million dollars

Source: Fundaci贸n ExportAr data based on Info-Just

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In 2009, according to province of Entre Ríos sources, the United States, Brazil, Vietnam, Belgium, France, Spain, Italy, Ukraine, Russia, Angola, Saudi Arabia, Chile, Congo, United Arab Emirates and South Africa, and others were among the leading purchasers.

If we take these expert opinions to establish the market scenarios of the province of Entre Ríos, it is possible to observe that:

-Average growth of provincial exports is estimated at around 9.6%, according to the Argentine Chamber of Trade, thanks to the development of the leading export industries, as reported by different journalistic sources.

- Among the leading clients for the province’s exports, the upwards trend will be maintained in 2011 due to:

Brazil Chile

The per capita consumption of foodstuffs will grow 21% in 2011, from USD 1284 to USD 1481. Although the Chilean trade balance is positive in the sale of food and beverages, it is understood that purchases from the province will continue to be of preparations of frozen chicken and rice, with growth in these operations in recent years of around 29% and 10% respectively compared to 2008. In the nonalcoholic beverages market, sales of juices will rise by 18% over 2010. However, the deficit in pharmaceutical products will grow by 15% compared with 2010 so that in 2011 imports should rise to over USD 579 million.

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Per capita consumption of food and beverages in general will reach USD 1108, 8% higher than in 2010. Meanwhile, the trade balance of pharmaceutical products will show a deficit, with imports for 2011 reaching USD 4.538 billion.

Sales of juices will record an increase of around 17% with values of over USD 1.5 billion by the end of this year.

Uruguay

Current levels of trade indicate that growth will continue in this country’s purchases of mandarins and rice. Likewise, sales by the pharmaceutical market are estimated to reach USD 264 million, a rise of 15% compared to 2010.

Germany

Sales of fruit and vegetable juices will report a slight rise from USD 967 million in 2010 to USD 989 million this year. The consumption of rice will grow by around 1%, meaning a rise in imports to 276,000 tonnes, 4% above the volume demanded in 2010. Poultry production will not be able to satisfy local demand so an increase in imports of around 2% is forecast for 2011 to reach a volume of 226,000 tonnes.

Meanwhile, consumption of honey will rise since it is used as a substitute for sugar by health-conscious consumers. Sugar consumption will fall 2% in 2011 (from 3180 tn. to 3109 tn). Imports of beverages and foods in general will exceed 15 billion by 2011, a growth of 8% compared to last year.

Russia

The state of the agricultural sector and of the processed food industry have limited any room for improvement among Russian suppliers, meaning that a great number of foodstuffs must be imported, at the expense of local manufacturers. The products with greatest impact in 2011 will be: A) Sales of juices will rise to over 3.440 billion dollars, 19% more than in 2010.

B) Pharmaceutical products will report a trade deficit rising to over 10 billion dollars, 13% above 2010 figures.

C) Chicken meat imports will exceed 200,000 tonnes.

China

Due to a gap between production capacity and domestic consumption, China will import some 617 tonnes of chicken meat in 2011, meaning growth of 126% over the values requested in 2010. However, the increase in demand for chicken meat –with an average for 2011 of 6.8%will be maintained in the long term increasing China’s dependency on imports. It is necessary to mention here that the country has imposed antidumping tariffs of 105.4% on shipments of chicken meat from the United States for the next 5 years. Although it is expected that the conflict will eventually be solved, in the process prices will rise, encouraging new producers to enter the market. However, this will not diminish international purchases. In reference to food and beverages, China has a very large trade deficit (USD -5.182 billion), a figure which is forecast to grow by 35% during 2011, leading to a deficit of USD -7.021 billion. In beverages, sales of juices increased by around 17%. In pharmaceutical products the Chinese trade deficit will increase by 37% with estimated imports for 2011 of over USD 8.500 billion.

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Complementary and substitute products Complementary and substitute products of exports from Entre Ríos will vary according to patterns of consumption in destination markets. For example, exports of chicken meat could be replaced by pork in China, while in Muslim countries they are more likely to be substituted by halal beef or fish.

In seeking to add value to international sales in the region and with the aim of intensifying trade in certain products, this analysis looks only at articles sold by the province. Therefore, if Entre Ríos exports chicken meat, with which other item within its exportable supply can it be substituted, and with which can it be complemented, regardless of any analysis of foreign consumption patterns?

Having said this, it can be concluded that the items most exported by Entre Ríos and their possible complementary and substitute products are found in the following table:

Complementary and substitute products of Entre Ríos exports Exported product

Substitute product

Complimentary product

Chicken

Meat of bovine, swine or fish

Vegetables, fruits, rice, fruit juices and natural honey, among others

Citrus fruit

Other citrus fruits (mangoes, kiwis, etc) and products with citrus qualities

Chicken and natural honey, among others.

Fruit juices

Flavored water, soft drinks, non alcoholic beverages

Chicken, natural honey, rice and pharmaceutical products, among others

Bilberries

Other berries

Chicken, medicaments and natural honey, among others

Rice

Wheat and its derivatives, maize, millet, cassava and potatoes, among others

Natural honey, chicken, fruit juices, among others

Medicaments

Herbal products, homeopathy, etc.

Fruit juices and natural honey, among others

Natural honey

Sugar and sweeteners

Chiken, citrus fuit, fruits juices, bilberries and rice, among others.

Fibreboards

Solid wood and plastic, waferboard, etc.

Mouldings, sawn wood, doors

Source: Fundación ExportAr data based on BMI, Argentine Foods Magazine

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Positioning of our competitors and national production Exports from Entre Ríos contribute several millions in foreign currency to national sales abroad. In fact, during the last 10 months of 2010 operations by the poultry sector meant a 52.1% share in national exportable supply, while the fruit sector accounted for just 10%. In addition, the pharmaceutical sector contributed 1.4%, rice sector made up 43.6% followed by the forestry sector with 17.7% and the beekeeping sector that contributed 8.2%.

Meanwhile, the national exportable supply came within the top ten in the world for products produced mainly in Entre Ríos, except for pharmaceuticals in which it obtained 11th place, a situation which can be seen in the chart below:

Leading exporting countries of the exportable supply of Entre Ríos and Argentina’s positioning in thousands of dollars FOB. Year 2010.

Exported product

Exporter ranking

USD FOB

Poultry

1º Brazil 2º USA 3º France 7º Argentina 1º USA 2º South Africa 3º Turkey 5º Argentina 1º Thailand 2º USA 3º China 4º Argentina 1º France 2º UK 3º USA 11º Argentina 1º China 2º Argentina 3º New Zealand 1º China 2º Thailand 3º France 9º Argentina

5,952.027 3,824.513 1,217.657 978.023 954.113 899.064 865.330 349.484 5,305.272 2,354.057 415.778 233.345 27,168.335 26,784.788 23,133.129 563.616 182.514 173.217 71.161 1,113.794 347.011 270.762 89.497

Citrus fruit

Rice

Pharmaceutical products

Natural honey

Wood

Source: Fundación ExportAr data based on Global Trade Tracker.

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Access to main export markets of Entre Ríos 7 Tariffs Germany

Russia

SECTOR

HS CODE AVERAGE TARIFF

Poultry

12.20% 10.11% 11.56% 17.30% 9.05% 5.67% 0% 0% 3.5%

0207 0210 0408 Natural honey 0409 Citrus fruit 0805 Rice 1006 Pharmaceutical 3002 products 3004 Wood 4411

- VAT: standard rate 19 %. Foods 7.% - Levy over certain agricultural goods when their international reference prices are below the minimum standard level.

SECTOR

HS CODE AVERAGE TARIFF

Poultry

0207 0210 0408 0409 0805 1006 3002 3004 4411

Natural honey Citrus fruit Rice Pharmaceutical products Wood

50.78% 11.63% 26.03% 11.25% 4.33% 25.29% 10.01% 8.96% 15%

Tariff preference for Argentina: 25% VAT: standard rate 18%

South America Products analyzed above do not have tariff to enter Brazil and Uruguay.

Chile, on the other hand only levies 5.6% tariff on HS Code 1006.

In Brazil domestic taxes are: IPI (0%20), ICSM (7.65%), PIS/PASEP (1.65%) and COFINS (0%-25%).

In Uruguay consultar rate (2%), VAT 10% min –foods and medicaments-; 22% standard rate –machinery-), and Vat advance (10% on income). Chile only levies 19% VAT.

7 Source: “Guías país” - Argentina Trade Net - www.argentinatradenet.gov.ar “Compare Tariff and Trade” - International Trade Centre - Trade Map - http://www.intracen.org

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China SECTOR

HS CODE

AVERAGE TARIFF

Poultry

0207 0210 0408 0409 0805 1006 3002 3004 4411

14.7% 25% 20% 15% 11.49% 33% 3.94% 0.21% 5.11%

Natural honey Citrus fruit Rice Pharmaceutical products Wood

VAT: standard rate 17%. Certain foods and books 13%.

Consumption tax: ranging from 1% to 45 % depending on the traded good.

Non-tariff restrictions All the countries analysed have certain requirements in common for the entry of goods into their market. Others vary according to the market and the sector to which the product sold belongs. The first mentioned are:

Pro forma.invoice Commercial invoice.

Transport document.

Cargo list.

Certificate of origin.

Health certificate.

Insurance policy.

Documents requested by each country for allowing entry of different products into its market.

Document

Germany

Russia

China

Chile

Uruguay

Brazil

Authorisations / Import controls Import licence Statistical inscription note Customs declaration Customs value declaration Passport (currency control) Certificate of customs destination Authorisation of use and disposal Registration in the General Tax Office or Banco de Previsi贸n Social Registration in food safety (foodstuffs) Sales certificate (L.A.T.U.) Single import document Registration of importer and producer Bank receipt (darf) of tax payments Register of drugs/foodstuffs Certificate of quality and conformity Certificate of production establishments (chickens) Veterinary certificate (chickens) Import report Sworn statement of financial history Sworn statement from private warehouse or temporary admission Health service or sanitary control of foodstuffs Hygiene certificate Cargo manifest Source: Argentina Trade Net and Fundaci贸n ExportAr

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Labelling and packing requirements The main aspects to emphasize: Labels must be written in the language of the destination country and give at least details of the manufacturer, exporter, importer, country of origin, type of product, name, brand, form of conservation and use, details of sanitary authorization, list of ingredients and their expiry date, if applicable. For Russia, the price in roubles and the purchasing conditions should also be added. For products shipped to Germany the use of the eco-label and compliance with relevant European Union decisions must be taken into account.

Labelling requirements for foodstuffs packed in the MERCOSUR are regulated by Resolution N° 21/02 of the Common Market Group adopted by Brazil under Resolution Nº 259 of 20/09/02, and modified by Resolution N° 123 of 13/05/04.

The containers used for food products for human consumption must be of natural materials, synthetic materials or of another suitable material, which do not transmit strange smells or flavours to the product itself.

For packing, resistant material must be used that provides suitable protection to the containers to prevent their external deterioration and, in turn, to facilitate handling, storage and distribution. All wooden packing cases must be fumigated and bear a sanitary certificate, regardless of the nation to which they are exported.

In reference to quality controls, in China all food products are checked by the Commodity Inspection Bureau, which issues a document certifying the procedure. Once issued, a laser security label must be affixed to the merchandise.

In the case of Russia, a certificate of conformity in compliance with the established guidelines, issued by the competent authority that is Zao “Rostest Moscva”, must be presented for each of the products exported. Many products, whether imported or produced domestically, are subject to security certification and must be recorded by the Russian State Committee for Standardization, Metrology and Certification (Gosstandart), an authentication office or a foreign company authorized by Gosstandart.

Chile demands the application of certain technical requirements for the entry of mandarins into the country, in particular, Chilean norm (NCh2580). The body verifying compliance is the Instituto Nacional de Normalización (national Standardization Institute).

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Fruits and vegetables in general and rice must also satisfy other standards that may be found at http://www3.inn.cl/ ventas/texto/index.php.

Germany, on the other hand, oversees compliance with the sanitary inspection of imports, the phytosanitary inspection of imports, the veterinary inspection of imports, Good Manufacturing Practices (GAP), Hazard Analysis and Critical Control Point (HACCP) and enforcement of the Convention on International Trade in Endangered Species (CITES), depending on the nature of the product sold. Likewise, ISO standards are fundamental when introducing products into the target market.

Generally, the articles that comply with the regulations mentioned here bear on their labels the EC (European Conformity) or the CS (certified security) seal.

In Uruguay, foodstuffs must comply with the demands of the Ministry of Public Health, or the Food Codex if the former has no regulations governing the imported product. Quality designations (verified, certified, or the like) can only be used when dealing with goods whose conformity with the regulations and other applicable standards has been certified by the Technological Laboratory of Uruguay (LATU), Uruguayan Institute of Technical Norms (UNIT), Uruguayan Wool Secretariat (SUL), the University of the Republic, or other organizations authorized by the National Quality Committee. The bodies certifying conformity of the products must use the procedures approved by the National Quality Committee.

In the case of Brazil, foodstuffs are also subject to quality control. Once approved, a document is issued that certifies that the products of vegetable origin or their subproducts comply with the norms established by the Ministry of Agriculture, Supply and Agrarian Reform in order to protect consumers.

For products from the MERCOSUR, border controls by competent sanitary or zoosanitary agencies of the importing State Party will be restricted to checking the documents issued by the competent sanitary or zoosanitary agencies of the exporting State Party.

Sales channels

Russia The Russian Federation has over 140 million inhabitants in 11 different time zones, making it a diverse economy with huge natural and human resources. The demand for products and services is strong, with high imports of consumer goods.

The areas of greatest sales concentration are Moscow and St Petersburg, especially for consumer goods, but expansion is taking place to other areas, like the following:

Moscow and surrounding area

It is the largest and most accessible area for the consumer goods market. Moscow is the financial and political centre, home to a large percentage of the emerging middle class, and the city of greatest economic diversity, the most modern means of transport and communication services and other commercial structures.

St Petersburg and North-west Russia

St Petersburg is Russia’s second largest city and the fourth in Europe. Its port is the country’s largest commercial maritime port by volume, receiving over one third of Russia’s imports. St Petersburg also has a large train system connecting it with Moscow, other regions of Russia and Eastern Europe.

In many cases in this area of Russia, the primary factors in competition are price and financing, delivery terms, adaptability of the product, good representation and a good distribution channel.

The Urals and the West of Siberia

This region is one of the richest areas in resources of Russia and the centre of heavy industry, like the aerospace industry and the national defense industry.

The Russian Far East

This area faces several obstacles to strengthening international trade. It is at a great distance from the rest of Russia, it has transport problems such as reliable flights, local leaders have little international experience, decaying infrastructure including telecommunications, water, electricity, medical services, and accommodation. Travellers also face restrictions.

Central and Southern Russian

The cities of Perm and Tatarstan are both of great importance thanks to their engineering, aeronautical, chemical, electrical, oil and timber industries. The area boasts a favourable investment climate thanks to its good infrastructure and its strategic geographical location.

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Large-scale distribution In terms of the modern distribution of foods, different formats e.g. hypermarket, supermarket and convenience stores, stand out in contrast to older establishments inherited from the Soviet Union, which are gradually disappearing. According to the positioning of the relevant establishment (premium or gourmet, medium, economic class, discount stores, etc.) products of different quality are sold.

With the first indications of saturation in Moscow and St Petersburg, distribution chains in Russia are currently expanding into the region and are concentrating to create large federal operators. Consequently, the spread of modern distribution will continue in the medium term. Just as in the rest of the world, the relationship between suppliers and chains is not an easy one. In Russia all large manufacturers or large importers want to place their goods in the most important chains. The explanation is obvious and placing part of their production in one or more links removes many headaches for the manufacturer or importer.

However, a standard contract between a chain and a supplier reveals the dominant position of the former in, for example, demands for exclusivity, the use of discounts in the price of the product in merchandising by the chain, the consequences of certain sales results, the opening of new stores and inclusion in the chain’s logistics system.

To work with a chain, suppliers must satisfy hundreds of conditions imposed by the distributor. To begin with, payment of an import entry tax and the first order free of charge for sampling by company representatives and/or consumers (promotional sampling) with the aim of analyzing its chances of profitability.

Besides, the supplier must comply with guarantees, conditions concerning logistics of the supplies (punctuality, no delays or early deliveries exceeding 40 minutes outside the fixed delivery time), marketing (attractive container, payment of rental on site assigned to the product), and have the required financial capacity to withstand delays in payment.

In addition to the actors mentioned, cash & carry stores, traditional markets and hotels, restaurants and cafĂŠs (HORECA) are all important in the distribution chain. These chains do not import directly from abroad because of the logistics complications involved in this type of operations. The situation is unlikely to change in the short or medium term.

Experienced exporters, and others with less experience in the selection of agents and distributors, know that the best way is to proceed gradually in making a choice.

The strategy involving greatest risk is visiting the country a couple of times, choosing an agent with exclusive representation, then obtaining sales on credit without establishing a solid record, especially in questions concerning payment.

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Similarly, of course, some foreign companies have their own representatives in the big cities that sell directly to the big importers, who then take possession of the goods outside Russia and import themselves.

Among other aspects, it is necessary to state that the retail sales of other products, such as drugs, are not the exception and follow the same pattern as the remaining consumer goods; 40% of which are concentrated in the 10 largest cities in the country and half of this percentage is accounted for by operations made in Moscow and St Petersburg. Pharmacy chains have increased their market share thanks to the high number of retail sales, so in Moscow and St Petersburg almost 20% of drugs are sold to the public through these intermediaries.

Besides pharmacies and other distributors, direct sales to hospitals and the use of large distributors provide important additional channels. In Russian cities, telemarketing and marketing by fax to business clients are common, but rather ineffective.

However, direct person-to-person marketing works very well.

Other direct marketing systems used are catalogues, Internet or e-mail. Few clients have a credit card, although the number is expanding, and this affects online sales. Nevertheless, Internet catalogues save high distribution costs in Russia and have great potential to increase profit margins in a marketing segment which will see considerable growth in coming years.

In purchases by the public sector, the leading channels for purchasing drugs are the bidding processes held with Federal Administration or local government funds. Many branches of multinational enterprises established in Russia take part in these bidding processes, which assure them significant sales.

However, the bidding processes continue to be closed and lack transparency. The information needed to attend them is usually sketchy, and no single publication brings together all the relevant information.

Likewise, there has been considerable concentration in the drugs distribution sector in Russia in recent years, allowing the principal 15 intermediaries to currently control 52% of the market, and the three biggest 35%.

Uruguay In general, there are two important stages in selling: wholesale, comprising importers and distributors (frequently the same firms), and retail.

In recent years in Uruguay, as well as in other countries, new forms of retailing have developed successfully, displacing the traditional ones. Among these expanding forms are:

- Supermarket chains (food, personal and home hygiene, various).

- Shopping centres (clothes, electrical household goods, toiletries, stationery, services, various).

- Direct selling systems, telemarketing and other forms of selling (expanding).

Due to the characteristics of Uruguay, two differentiated markets can be distinguished:

- Montevideo, with over 40% of the country’s population, is a geographically concentrated market with greater average purchasing power than in the rest of the country. The strata of middle- and high-income consumers are relatively better represented in the capital than elsewhere in the target destination.

- Outside the capital, there is a scattered market with lower purchasing power. How-

ever, some localities away from the capital may be an attractive market due to their population and income levels, e.g., the Department of Canelones, particularly Montevideo’s area of influence (Costa de Oro, Las Piedras, Pando, etc.); the Department of Maldonado (Punta del Este, Piriápolis, Maldonado, etc.); the Department of Colonia-Paysandú.

Germany With over 82 million inhabitants, the German market is the largest and most important in Europe. It is highly competitive and is much segmented with partial saturation in the provision of many sectors and products, implying that quality and excellence in the service provided are vital for differentiation.

There are currently numerous channels in the destination country and they vary according to the sectors. However, in general, it is possible to have agents or distributors who act as retailers or wholesalers, and importers or exporters. These players usually resort to agency and distribution contracts and to imposing exclusivity and competition clauses. Other exporters prefer to avoid intermediaries and resort to practices like joint ventures, franchises and licenses, or they simply establish their own offices in the target destination.

Likewise, other links in the distribution chain are the electronic trade and telephone sales, very widespread among the German population for most consumer products.

Distribution for the business market (B2B) does not operate under the same terms as the retail market. To sell wholesale in Germany it is fundamental to have national or regional representation and it is very important to take part in any international events held there, not only to capture new clients, but also to cultivate the loyalty of existing ones.

Business activities serving the consumer (B2C) are characterised as having a selling structure comprising a large number of small independent shops, a low level of concentration, a predominant presence in urban centres and a low number of hypermarkets balanced by the dominance of discount stores and the participation of distance selling (80%), made up according to importance by e-commerce, telesales, mail order and sales from product-related publications.

Besides this division, a more accurate segmentation of German retailing is shown in the graphic below with the comparative share of each of the actors in the system, both for 2004 and expectations for 2010.

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Market share of members of German retail system. Years 2004 y 2010

Source: Ifo-Institut & Destatis

DIY: Do It Yourself

Brazil After the liberalization of trade begun in 1990, many agents and distributors have become companies and have begun to import and sell on their own. Nowadays, most of the large sales chains have their own import agency.

Although some firms import directly from foreign manufacturers without local representation in Brazil, in most cases, the presence of a local agent or distributor is of great help. As in other countries, the choice of these intermediaries requires careful consideration. Because of regional economic disparity, the different states of infrastructure and many other aspects, it is frequently awkward to find a distributor with national coverage.

Lawyers recommend that exporters and representatives have a written contract which will help them to limit their legal liability in cases of product defects, protect their registered brand, guarantee payment and define the terms of warranties. Clauses on exclusivity and performance goals may be included in the agreement.

For many years, supermarkets and, in particular, hypermarkets have become more and more important in the field of distribution. They are so important that Brazilian hypermarkets account for 80% of sales of basic foodstuffs.

Shopping malls, outlets, hypermarkets, supermarkets and convenience stores have been developed with the customer profile in mind. Many of these places are designed to offer a broad range of services including restaurants, cafeterias, gymnasiums, beauty parlours, shoe repairs, post offices, bank services and launderettes. There are also entertainment facilities like cinemas, cyber-cafÊs and children’s play areas.

As for convenience stores, the large retailers see the concept of convenience in the retail 72

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industry as part of the traditional format. In this regard, establishments operating in service stations account for around 0.4% of total sales. Nevertheless, there are also many hybrid formats that include a broad range from outlets to small independent stores and bakeries.

Among retailers selling non-food products are Casas Bahía and Ponto Frio, specialists in furniture, household electrical appliances and home equipment; Lojas Riachuelo and Lojas Renner, department stores; and Drogaria São Paulo, chain of retail pharmacies and drugstores.

Chile The choice of distribution and sales channel must be made according to the characteristics of each product and knowledge of the Chilean market. Bearing in mind that Chilean consumer habits are influenced by European and American models, the quality-price ratio is very important in penetrating this market.

Although distribution in Chile can prove to be difficult due to the enormous distances in the country, it should be remembered that nearly 40% of the country’s total population lives in the metropolitan region, which includes Santiago.

Likewise, importers, agents or distributors, focus their work on the capital, Santiago, from where the majority distribute imported products to other regions in the north and south of the country.

In Chile, the multistore chains and supermarkets have experienced great development. The former have their main exponents in Falabella, Almacenes París and Ripley. These chains have stores in many cities in the country and sell products of all kinds.

Supermarket chains have also achieved considerable coverage throughout the country.

However, only one chain has strong presence both in the capital and in other regions, D & S. There are other groups like Santa Isabel which have a stronger presence outside Santiago, while Jumbo is so in the city.

The current situation indicates that the Santiago market is fairly saturated, so supermarkets and multistores are tending to expand even more into the regions. This same expansion trend to the regions is occurring with the malls, which are often built next to large supermarkets and multistores. At present there are 12 malls in Santiago, and another 15 throughout the country, with coverage from Iquique to Puerto Montt. It is believed that in the regions the consumer sees the mall as a positive addition to his city and so identifies with it.

However, if an agreement is made with any of these chains, distribution for the exporter is limited to delivering the products in Santiago, and the chain then takes them elsewhere in the country. Equally, the smallest importers, agents or distributors focus their work on the capital, Santiago, from where the majority distribute the imported products to other regions of the country.

Agents earn a commission or fee on sales made while distributors receive as their profit margin the difference between the purchase price of the goods and the resale price on the market. When establishing a commercial relationship with them, exclusivity, rights and liabilities, geographic scope and a detailed description of the services offered, among others, must also be established.

Supermarkets, hypermarkets and especially shopping centres are a very good option for the distribution and sale of products such as fashions, foods, cosmetics and consumer goods in general. These commercial centres have very well structured specialized sections, as well as large distribution chains of products and boutiques (Falabella, Riplay, Almacenes París, etc.).

The distribution channels through which access can be gained to the forestry products market are the specialist stores or small shops or large construction and materials centres like SODIMAC and EASY.

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China Distribution is a key factor of success in the Chinese market. Due to high costs and the lack of efficiency, those companies that do manage to find solutions in distributing their products, will have a great competitive advantage.

Due to the size of the market and its regionalisms, the first step in gaining a foothold consists in finding a good distribution strategy that will correctly channel the products to the end consumer.

The Chinese market must be viewed as a collection of regional markets with special characteristics. The country’s history has made the development of a national distribution system impossible, since the Government fostered a system in which each city had to be self-sufficient.

As a result of the above, distribution today is a complex network that demands that importers cultivate relations with individual distributors and wholesalers in different regions and at different levels.

In such a complex system, it is vitally important that distributors are chosen with extreme care beforehand and that a relationship is established with them that allows them to work closely together, in order to ensure sales and correct service.

It is essential to have an independent agent since he is usually in a better position to offer the market contacts and knowledge required to introduce the product.

It is vital that the exporter to China check, before starting operations, all relevant information regarding his local partner, such as the quality of his sales network, possession of required licenses, legal situation, indebtedness, etc.

The number of options available for companies that wish to set up distribution networks or selling activities in China is large. They can resort to any of the resources shown below according to the China–Britain Business Council and Austrade:

- The Import/Export Agent.

- Set up a representative’s office.

- Establish a Trading Company in a Free Trade Zone (FTZ).

- Purchase a local enterprise in the sector to create a new company.

- Found a Chinese Holding Company.

- Strategic alliances.

- Entry from Hong Kong.

Since the end of 2004, an extra option has been the so-called Foreign-Invested Commercial Enterprise, or FICE. This is a very important development since in the past foreign investors were excluded from the distribution sector.

This presented great difficulties for investors when selling their products directly in the Chinese market. They were forced to use import/export companies, or to set up a trading company in an FTZ. Entry to the WTO brought a profound transformation in the Chinese distribution system, with their traditional distribution operations, which were simply intermediation tasks, being left aside.

Under these agreements, China agreed to progressively liberalise wholesale distribution and retail sales for almost all kinds of goods over a period of five years from the date of entry into the WTO. Only tobacco and salt were excluded from the liberalization régime.

The qualitative and geographical restrictions or those on the capital structure and creation of the enterprise were also eliminated in order to stimulate the establishment of joint ventures with foreign enterprises. These and the FICES have had a great impact on the shape of the distribution sector, creating a large number of new opportunities.

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To design a suitable distribution strategy in China, consideration must be given to both the product and the scope sought. Although the techniques applied in other developing or postcommunist markets may be effective, it is likely that mechanically transferring those experiences to China will lead to failure.

There are specific limitations stemming from its infrastructure and from considerable differences both in the legal framework and in the way of doing business of the Chinese. For these reasons it is advisable that any distribution strategy designed for this market should be geared to securing certain objectives like optimizing penetration.

Given the fragmentation of the Chinese market, slow penetration is advisable as opposed to maximizing entry straight away. The best strategy is to advance city by city or region by region.

With the variable character of Chinese retail trade, any attempts to introduce a product in all possible outlets may damage the brand due to excessive exposure at unsuitable points of sale.

Foreign companies need to ensure that any agreements made with their partners and third parties should afford them sufficient room to maneuver so they can change strategy when necessary. For this reason, exporters should be particularly careful when choosing the right distributor.

As mentioned above, China presents a true challenge in questions of transport and distribution. Its vast territory plus its over-population, myriad regional dialects, its inadequate infrastructure, and complicated government control on foreign participation in the market make it unpredictable.

Due to the complexity of introducing foreign products into the Chinese market, it is vital to have the assistance of a partner accustomed to selling in the target destination.

Enterprises in Oceania, particularly in New Zealand, are the most suitable vehicle for entry into China to gain experience in the market and to obtain the necessary contacts. The reasons for this possible strategy are as follows:

- The advanced stage of negotiations on Bilateral Free Trade Agreements (Australia–China, New Zealand–China). As regards the second agreement mentioned, negotiations were scheduled to end by 2007- 2008, which would make New Zealand the first western country to have a pact of this nature with China.

- There is a permanent cultural exchange between the nations concerned, especially in the field of education.

- Geographical location, close to the destination country.

- Asia-Pacific supplies over half of Chinese imports.

- Participation at International Fairs of the sector.

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Sources - “Producto Bruto Geográfico 1993-2008” – Directorate of Statistics and Censuses of Entre Ríos – www.entrerios.gov.ar/dec

of the Argentine Republic to the Russian Federation, June 2008 www.argentinatradenet.gov.ar

- “Proyecto Estudio de los Recursos Naturales en la Cuenca del Río Uruguay Utilizando Sistemas de Información Geográfica” – Centre for Scientific Research and Technology Transfer to Production www.cycyttp.org.ar/ climatologiafca

- “Germany Market Access” – Alibaba – www.country.alibaba.com/ profiles/DE/Germany/market_access.htm

- Ministerio del Interior – Provinces Secretariat www.mininterior.gov.ar/provincias

- “German Retail” – Direct Market Report – Petercam. www.europe-re.com/files/00035900/Petercam_Direct.pdf - “Doing Business in Germany” – U.S & Foreign Commercial Service – Year 2008 – www.export.gov

- Gobierno de Entre Ríos – www.entrerios.gov.ar - “Provincia de Entre Ríos: informe de situación” – Equipo de Gestión Económica y Social. http://eges.com.ar -“Actividad avícola en Entre Ríos” –Production Secretariat, Government of the Province of Entre Ríos. www.entrerios.gov.ar/produccion/ppal_subs_produccion_animal.html -“Panorama de la citricultura en Entre Ríos” – General Directorate of Plant Production, Government of the Province of Entre Ríos. www.entrerios.gov.ar/produccion/ppal_prod_agric_rec.nat_ydes_rural.html -“Informe de la Provincia de Entre Ríos” – I.N.T.A (E.E.A. Concordia). www.inta.gov.ar/concordia -“Informe Sector Alimentos Industrializados: Miel” – Undersecretariat for International Trade, Argentine Ministry of Foreign Affairs. www.argentinatradenet.gov.ar/sitio/estrategias/INFORME%20SECTORIAL% 20MIEL%202010%20_para%20actualizar_.pdf

- “Acceso al mercado chileno de productos lácteos” Argentine Embassy in Santiago de Chile - Año 2007 www.argentinatradenet.gov.ar - “Germany: E-commerce” – U.S & Foreign Commercial Service 2007 – www.export.gov - “Annual Monitoring Synthesis and Emerging Trend Updates” European Perspectives on the Information Society – Joint Research Centre - European Commission - http://ftp.jrc.es/EURdoc/JRC47923.pdf - “Brazil: New consumer dynamics” The impact on modern retailing – PriceWaterhouseCoopers www.pwc.com/en_GX/gx/retail-consumer/pdf/brazil.pdf - “Brazil Retail Food Sector” - USDA Foreign Agricultural Service 2008 www.fas.usda.gov

- Base de datos Info-Just

- “Consumer Trends in Brazil” – Danish Consulate General in São Paulo – www.ambbrasilia.um.dk/en/servicemenu/News/ConsumerTrendsInBrazil.htm

- “Industry Forecast Scenario: Russia” – Q1 2011 – Business Monitor International – www.businessmonitor.com

- “Guía de negocios de Brasil” – Argentine Embassy in Brasilia. www.argentinatradenet.gov.ar

- “Industry Forecast Scenario: China” – Q1 2011 – Business Monitor International – www.businessmonitor.com

- “Guía de negocios de China” – Argentine Embassy in Beijing. www.argentinatradenet.gov.ar

- “Compare Tariff and Trade” – International Trade Centre – Trade Map www.intracen.org

- “Guía de negocios de Chile” – Argentine Embassy in Santiago de Chile – www.argentinatradenet.gov.ar

- Revista Alimentos Argentinos Nº 5, 16 & 17 – www.alimentosargentinos. gov.ar

- “Guía de negocios de Rusia” – Argentine Embassy in Moscow. www.argentinatradenet.gov.ar

- “Las exportaciones del 2011 podrían alcanzar los u$s 78.000 millones” – Río Negro Online - www.rionegro.com.ar/diario

- “Guía de negocios de Alemania” – Argentine Embassy in Berlin. www.argentinatradenet.gov.ar

- “Guía para exportar a Rusia” – Colombia ProExport – Year 2008. www.proexport.com.co

- “Guía de negocios de Uruguay” – Argentine Embassy in Uruguay www.argentinatradenet.gov.ar

- “Country Commercial Guide of Russian Federation” – U.S & Foreign Commercial Service - Year 2007 - www.buyusainfo.net/docs/x_1414866.pdf

- “Perfil de arándanos en China” – Argentine Embassy in Beijing. www.argentinatradenet.gov.ar

- “Informe individual: series de perfiles de la industria farmacéutica en la Federación Rusa” – ICEX – www.icex.es

- “China: Canales de distribución” – Junio de 2009 – ICEX www.icex.es

- “Productos Farmacéuticos/Rusia” - ProArgentina www.proargentina.gov.ar

- “Doing business in China” – Austrade – http://www.austrade.gov.au

- “El mercado de la carne en la Federación Rusa” – ICEX – March 2008 – www.icex.es - “Perfil de mercado de carne aviar en la Federación Rusa” Embassy 76

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- “Setting up in China” China–Britain Business Council. www.cbbc.org - “Retail Highlights” – June 2009 – Nielsen. – www.acnielsen.com.br/ pubs/documents/RetailHighlights-Junho09_000.pdf

Fairs LAAD 2011 LATIN AMERICA AERO & DEFENSE 2011 Río de Janeiro, Brazil April 12-15 Aeronautics

In the city of Rio de Janeiro was held the 8th edition of LAADLatina America Aero & Space fair. The Argentine Republic participated for the first time with a National Pavilion where the offer of services and technology applied to this specific sector was displayed.

It was a joint action between Fundación ExportAr and the International Trade Support Program (PDCEX) from the Argentine Ministry of Foreign Affairs.

LAAD fair is an important international show in Brazil. In 2011 edition, in the Argentine stand many companies and entities of this sector interested in doing business and promotion at the Brazilian and international market showed what they had to offer.

On this occasion, the Argentine Republic on a surface of 63 square meters participated with the following companies and entities: Dirección General de Fabricaciones Militares, I.NV.A.P S.E., FADeA – Argentine Factory of Aircraft “Brigadier Gral.

San Martín”, CINAR (TANDANOR – Almte. Storni), SINPRODE 2011, and Redimec SRL, turbo division.

During the opening ceremony of the fair, there were present the Vice President of Brazil, Dr. Michel Temer, and high national authorities, among them the Minister of Defense, Dn. Nelson A. Jobim, as well as a number of international delegations.

According to the information by the organizer, in this edition participated 55 official delegations from 53 countries, 660 exhibitors and there were 18 national pavilions.

It is worth mentioning that the Argentine stand was the only Latin American pavilion, except for the Brazilian one.

FANCY FOOD 2011 Washington, USA July 10-12 Food and Beverages

Fundación ExportAr will hold the Argentine Pavilion at the Summer Fancy Food Show where businessmen from the sector will exhibit their products on a surface of 182 m2. Participating in this fair is an answer to a sector in which the demand of this sort of products: premium food, specialties, delicatessen, and premium wines, is growing in big cities, supported by a varied sector of specialized manufacturers and businessmen, and fostered by consumers of higher incomes.

The US still is a market for great opportunities for Argentine food products since the volume of imports keeps increasing 15% above the rates of 2008.

The American agrifood market satisfies the demand of more than 300 million consumers, and generates a business volume around 1.3 billion dollars.

The diversity of consumers, the rapid evolution rate and a modification in habits constantly open business niches for the introduction of differentiated products and for new competitors as well.

Because of the geography, climate and privileged phytosanitary conditions in addition to a proactive business culture, Argentina has consolidated its high quality food and beverages products offer gaining recognition and confidence in the American market.

Companies of the sector show an important dynamism in terms of employment. In fact, in the last years the average number of workers employed increased over 50%.

Innovation and technological change are key aspects to foster the development in segments such as the gourmet one, where the quality and distinctive characteristics of the products are the core points in production.

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Rounds 3rd International Business Round of Machinery and Related Tools. EMAQH 2011

Predio Ferial La Rural, Buenos Aires, March 28-29 Machinery-Tools

Fundación ExportAr, the export promotion agency of the Argentine Ministry of Foreing Affairs, jointly organized with PROARGENTINA and EMAQH, the “3rd International Business Round on Machinery and Related Tools”.

The Business Round was held under the framework of the International Exhibition of Machinery and Related Tolls-EMAQH. This event was a privileged environment to exhibit technological innovations incorporated to machinery-tool, tools, measuring and control instruments, automation, industrial informatics, equipment and auxiliary elements.

2nd International Business Round of Food and Food Technology- FIAR 2011 Rosario, Argentina, April 13-15 Food and Food Technology

The International Business Round on Food Technology, Food and Beverages, jointly organized by Fundación ExportAr and the Municipality of Rosario finished last April 15.

The event was held at the Centro de Eventos Metropolitano of said city under the framework of the Rosario International Food Fair. FIAR was held for the first time in 1998.

Since then, and along the six biennial editions, this international fair has become renowned for the exhibition of first class products, technology, processes and equipment.

Buyers’ rounds gathered Argentine companies of the Machinery-Tools sector with the following importing and distributing foreign companies:

This is the second time Fundación ExportAr has jointly organized these round together with the Municipality of Rosario.

TECNIORIENTE S.A.S. - COLOMBIA LA LLAVE S.A - PERU AYNEC - ECUADOR PROMASIS – HONDURAS

During the three days of meetings, 11 foreign buyers and over than 70 national companies met and held around 275 interviews.

During the rounds, 62 meetings with Argentine companies took place.

It is worth mentioning that Argentine companies highlighted the importance of participating in business rounds, and the professional selection of foreign companies. The same satisfaction expressed visitors not only because of the quality of the meetings but also because of the attractive export offer that Argentine companies gave them.

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Visitors confirmed their interest in the following products: dairy, especially condensed milk, milk, whey, cheese powder; glucose; nuts; starches; lard and margarine for bakery; peaches in syrup and jelly and olives; gnocchi makers; food service, among others.

“Our challenge for the next edition of this fair is to reaffirm internationally the fair, and advance towards emerging markets such as Africa and Asia”, remarked Sebastián Schale, Secretary for Production and Development of Rosario, who also highlighted the challenge to keep strengthening sector shows.

Rounds 3rd International Business Round of Books 2011 Predio ferial de la Rural, Buenos Aires, April 19-21 Books

Fundación ExportAr and Fundación El Libro jointly coordinated the “3rd International Business Rounds of Books” at the Rural location under the framework of the 37th International Book Fair.

On the 19th, the opening ceremony took place and was held at the Javier Fillafañe room, and there were present the authorities from Fundación ExportAr and Fundación El Libro too.

ExportAr coordinated the participation of 7 foreign distributors and librarians that met with 34 Argentine publishing houses.

To carry out the Round there was a specific area designed to this effect called “Meeting Point”, however many meetings took place at national counterparties’ stands.

Publishing houses were satisfied with the excellent selection of buyers since their profiles and demands matched the national offer.

On the other hand, buyers from the US and Mexico said they have had a positive experience in terms of trade results, business potential, new contacts, finding new suppliers, strengthening previous trade bonds, and positioning in the Argentine market. Likewise, they are interested in participating in next editions of the Round.

4th International Business Round of Security Products and Services 2011 Predio Ferial La Rural, Buenos Aires, July 6-8 Security

Fundación ExportAr, trade promotion agency of the Argentine Ministry of Foreign Affairs, together with Indexport Messe Frankfurt and the Secretariat for Industry and Commerce Program PROARGENTINA, will jointly organize the “4th International Round of Security Products and Services”, to be held under the Seguriexpo 2011 fair.

This fair is a must for all those persons related to the security industry: businessmen, constructors, architects, security personnel, and big consumers that have contacted sector leaders making business relations and training.

In Argentina, the integral security industry is in permanent evolution and has state of the art technology. This sector continues to demand traditional solutions and brand new devices as well: intelligent buildings, biometrics new technology. Demands come from the public and private sectors, and also the demand in household security is increasing.

In 2010, business rounds gathered Argentine security companies with foreign importing and distributing companies from Bolivia, Brazil, Chile and South Africa. This year it is expected a bigger number of participating countries than in the last edition.

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Rounds International Business Round of Food 2011 La Rural, Buenos Aires, July 14-16 Food

Missions Trade Mission MIPTV 2011 Cannes, France, April 4-7 Audiovisual

Within the framework of the 125th International Livestock, Agriculture and Industry Exhibition will be held the International Business Round of Food.

In this edition, CITA Prize will again be awarded to innovation on agricultural technology. This prize is awarded to those companies that bet on research and development contributing to bring more productivity and innovation to the sector. Another edition of the Hall of Regions and Agrifood will be held, and it is a place where typical specialties of different regions of Argentina are displayed, within a meeting and exchange environment to foster the characteristic products of the different provinces of the country.

Fundación ExportAr will coordinate the Round, and 14 buyers from Africa, Latin America, and Europe will be invited to meet with companies specially selected from the sector.

In the city of Cannes took place the Audiovisual Programs International Market (MIPTV). On this occasion, and for the second time in a row, Argentina participated in a pavilion, due to the efforts made by the UCINE of the Secretariat of International Commerce and Economic Relations of the Argentine Ministry of Foreign Affairs, to promote the Argentine offer in the most important market of audiovisual content.

Under this framework, Fundación EpxortAr coordinated the stand and promoted Argentine talent in specialized magazines of the sector. This task was designed to cooperate with the UCINE and also to work on projects throughout time, facilitating access to international markets.

In this edition, the Argentine Republic displayed an attractive and functional pavilion of 27 m2, called “Argentina Audiovisual”, where companies from the sector had meetings and promoted their products and services.

Participating Argentine companies belong to the Argentine Chamber of Audiovisual Exporters, C.A.E.A., an association devoted to the promotion of the work and activities of its SMEs with official support too. 25 companies integrate the chamber, and they provide production services, locations and content producers.

More than 40 contacts showed potential for future business, some of the countries that expressed their interest in coproducing with Argentina are: France, India, Canada and Spain.

The “Workshop: Working with Latin America” was held on April 5. This event was designed to introduce successful case of regional coproductions with international partners, and was led by some of the bigger Latin American production companies.

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Missions Colombia Fashion Medellín 2011 Medellín, Colombia, July 26-28 Fashion

Training Seminar “Horse export” City of Salta, Salta, March 30 2011

The Ministry of Foreign Affairs, International Trade and Worship, Fundación ExportAr, ProArgentina and the Fashion Division of the Metropolitan Design Center will coordinate the participation of Argentine companies and designers in the next edition of Colombiamoda 2011.

By an initiative from the Commerce Directorate of the province of Salta and in cooperation with Fundación ExportAr, it was carried out a training activity to provide support on International Trade to the equestrian sector companies that wish to access international markets.

This event has a great meeting power among companies from around the world, so forth it is an excellent spot to do business with South American and European companies.

In this framework, Fundación ExportAr designed the content of a program based on basic aspects of international trade through an exporting sequence.

This promotion activity contributes to the development of production chains in the textile industry, to the cooperation and technology exchange, raw materials, design, marketing and foreign investment.

In the design of this program participated Mr Gerardo Fasano of Equus Trade company and members of the Training Division of Fundación ExportAr.

The goal of the fair is to strengthen relations between Europe, providing efficient technologies and investments for the sector, and South America, that offers knowledge, talent and raw material of the highest quality available.

Colombiamoda is the place where every person involved in the fashion world in Latin America, efficiently relates offer and demand through a tradeshow that displays household clothing making, leather goods, shoes, leather, jewelry and accessories, all of which are an essential aspect of modern clothing. This year, the fair will have, for the first time, a pavilion for the promotion of trademarks that want to expand their business by licenses and franchises contracts.

This Fair is an excellent platform to export with added value through precise positioning, facilitating the implementation of trade and business strategies, exhibiting differentiated trademarks and products, with indent of their own, widening the knowledge on consumer, product and industry trends.

The goal of this seminar was to give theoretical and practical support to contribute to the effort small and medium enterprises put in the process of becoming international and the development of competitive advantages.

The activity was held at the Rural Society of Salta and the numerous audience was represented mostly stud farm owners, breeders and veterinarians, and people related to horses and international trade.

At the opening ceremony participated Dr. Gerardo Márquez, Trade Director of the province of Salta, and Gerardo Fasano of Equus Trade, who spoke about customs regime in Argentina as regards horses, sanitary requirements demanded by other countries to enter horses, export logistics, reception and inbound traveling logistics and tax and fees that will be charged at the country of destination.

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Training Seminar “First steps in exporting” La Rioja, La Rioja April 6 2011

Fundación ExportAr together with the General Directorate of International Trade of the province of La Rioja coordinated a training seminar destined to the wine and olive oil industries.

Under this framework, many topics contained in the program were discussed: Basic aspects of international trade through an exporting sequence; as well as the activities carried out by trade promotion institutions at national, provincial and municipal levels, and their correlation in the internationalization process of the Argentina export offer.

Fundación ExportAr provided institutional information on the agency. In the design of the contents to be discussed during the seminar participated: Standard Bank Foundation Lic. Rubén Salandari, and Lic Sebastian Quintana of Technical support for companies and Training Division of Fundación ExportAr. The objective is to give useful theoretical and practical information in order to provide the public the necessary skills that companies need today to become active and competitive members at international markets.

The opening ceremony was conducted by Mr Carlos Sant, Director of the Directorate of International Trade, Local Development Secretariat of the province of La Rioja. In the first stage of the seminar the following topics were discussed: basic paperwork-roadmap, how to export from Argentina to different international markets. The second stage was about basic Operating Sequence of an export.

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www.exportar.com.ar

International Fairs Event

Sector

Country

Date

Summer Fancy Food

Gourmet

USA

10/07/2011

Agas

Food / Beverages

Brazil

01/08/2011

Fime

Medical

USA

10/08/2011

Ny Gift Show

Gifts

USA

13/08/2011

Bienal Do Livro

Books

Brazil

01/09/2011

Expoprado

Multisector

Uruguay

07/09/2011

Asia Fruit Logistica

Fruits and Vegetables

Hong Kong

07/09/2011

World Food Moscow

Beverages / Food

Russia

13/09/2011

Eaie

Education

Denmark

13/09/2011

Expocruz

Multisector

Bolivia

17/09/2011

Expoalimentaria Perú

Food

Peru

22/09/2011

Biofach Latinoamérica

Organic

Brazil

05/10/2011

Liber

Books

Spain

05/10/2011

Anuga

Beverages / Food

Germany

08/10/2011

Equipauto

Autoparts

France

11/10/2011

Frankfurt Book Fair

Books

Germany

12/10/2011

Pma

Fruits and Vegetables

USA

14/10/2011

China Educational

Education

China

15/10/2011

Interlift

Elevators

Germany

18/10/2011

Mercopar

Metalworking

Brazil

19/10/2011

Cphi

Pharmaceutical

Germany

25/10/2011

World Food Ucrania

Food / Beverages

Uk

25/10/2011

Canton Fair

Multisector

China

31/10/2011

Habana International Tradeshow

Multisector

Cuba

02/11/2011

Andina Pack

Packaging

Colombia

08/11/2011

America Food & Beverage

Beverages / Food

USA

14/11/2011

Fiera Cavalli

Horses and related industries

Italy

15/11/2011

Agritechnika

Agricultural Machinery

Germany

15/11/2011

Food & Hotel China

Food / Beverages

China

16/11/2011

Sial Middle East

Beverages / Food

United Arab Emirates

22/11/2011

Guadalajara International Book Fair

Books

Mexico

26/11/2011

Prishow

Performance racing

USA

01/12/2011

L´Artigiano In Fiera

Crafts

Italy

03/12/2011

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International Business Rounds July - November 2011 Round

Sector

Date

International Business Round of Shoes

Shoes

01/07/2011

International Business Round of Security Products and Services

Security

06/07/2011

International Business Round of Food

Food / Beverages

21/07/2011

International Business Round of Beef Genetics

Multisectorial

21/07/2011

International Business Round of Optical Industry

Optical

01/08/2011

International Business Round of Hotels

Hotels

30/08/2011

International Business Round of Food

Beverages / Food

31/08/2011

International Business Round of Wine Buyers

Wine

01/09/2011

International Business Round of Fishing Industry

Fishing

01/09/2011

International Business Round of Cosmetics

Cosmetics

01/09/2011

International Business Round of Art Dealers

Art and Antiques

01/09/2011

International Business Round of Fruit

Fruits y Vegetables

01/10/2011

International Business Round of Agricultural Machinery

Agricultural Machinery

01/10/2011

International Business Round of Electro-Lighting

Electronics

01/11/2011

International Business Round of Animation

Audiovisuals / Multimedia

01/11/2011

Products positioning program July - September 2011 Event

Sector

Country

Date

Taste Argentina in Cencosud

Food

Peru

01/07/2011

Argentine Bar in New Zeland

Food / Beverages

New Zeland

01/09/2011

Gourmet / Sweets

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