Ecuador exported $6,344 million during 2021 to the United States, the country’s main trading partner. Among the non-oil products shipped, shrimp, bananas, flowers and cocoa stand out.
Ecuador’s total imports from the US reached $5,391 million, of which capital goods, machinery, soybeans, among others, stand out.
The total surplus in favor of Ecuador was approximately $953 million.
Nery Merejildo, president of the Ecuadorian-American Chamber of Commerce of Guayaquil (Amcham, for its acronym in English) and vice president of the Association of American Chambers of Commerce in Latin America and the Caribbean (Accla) – a union that represents more than 20,000 companies and more than 80% of US investment in the region – affirms that the conflict between Russia and Ukraine can affect world trade that supports the economies of the planet.
He assures that the US market is an option to supply Ecuador’s exports to the conflict zone.
What is the role of the Ecuadorian-American Chamber of Commerce of Guayaquil (Amcham, for its acronym in English) in the current moments of world crisis due to the war between Russia and Ukraine?
At the moment it is known that Ecuador exports around $1,200 million to Russia and the Eurasian community in bananas, flowers and shrimp, mainly. Our mission as a binational chamber is to enhance the exchange relationship between the US and Ecuador, being a market that, due to its size, purchasing power, economic situation and more, still offers multiple growth opportunities, which would allow it to absorb part of the current volumes. exported to the markets of Eastern Europe and Eurasia. For this reason, our efforts are currently focused on commercial promotion actions to generate new business opportunities. Through Accla and Amcham we are taking the necessary actions to guide our partners in Latin America to face the current crisis.
Will they do any special service as an accompaniment to the affected companies so that they develop some type of strategy?
We have several initiatives and meetings between government authorities and the business sector to analyze actions and strategies that can be implemented in the coming days, to reduce the losses generated by this global crisis and find the best commercial and economic alternatives for businessmen. In this framework, Amcham maintains a dialogue with the Ecuadorian ambassador to the US precisely to analyze the impact of the Russia-Ukraine crisis on international trade, in particular the effects on our foreign trade, and complement the actions.
What is the impact of the crisis on international trade?
(At) Amcham, like the rest of business organizations, we are waiting for the actions that our main trading partners, such as the United States, the European Union and neighboring countries, are implementing. Let us remember that the impact is not only evaluated in the loss of the market, but also by the indirect effects that this causes by putting even more pressure on the cost chain due to the increase in international prices of inputs, transport services, logistics, and others. As business associations we must be constantly monitoring the situation in order to provide solutions to partners in a more efficient way that allows them to have viable alternatives to this crisis and generate new business in the international market.
How to strengthen business when export destinations are at war?
Ana María Gallardo, executive director of the Ecuadorian-American Chamber of Commerce of Guayaquil, advises national businessmen “to be permanently informed of the actions that are taken at the level of the government authorities”, as well as “support the unions in the search for commercial opportunities that allow them to serve new markets or expand their market share in their export destinations”.
One option, he adds, is “to carry out market intelligence to find out where there is a potential demand, where Ecuador already has access to the market and that allows generating new business opportunities.”
The United States is an option to expand markets. Where else can you get with Ecuadorian products?
As Amcham Guayaquil, we are currently executing a trade program that includes conducting trade missions to different States, as well as a business conference to expand the bilateral business of our partners that will take place in the coming months. The United States is a market of 329.9 million inhabitants, where approximately 60 million are Hispanic. There are 50 states with different characteristics and complementary economies with various opportunities for entrepreneurs, professionals and companies towards that market. For this reason, from Amcham Guayaquil we have strengthened our actions and conversations to continue in 2022 as a bridge that links the national business sector with the American one.
What are the options for those exports that are no longer destined for Russia?
Exports are a fundamental pillar for strengthening our economy, maintaining dollarization and boosting the country’s productive sector. The current crisis we are experiencing puts Ecuadorian exports in the banana, rose and flower and aquaculture sectors at risk for approximately $1.2 billion in exports to Russia, Ukraine and the Eurasian market. The business sector must look to other destinations to place its exports, however, the situation is complex and it takes time to divert trade to other markets. Not only must there be tariff and phytosanitary trade opening for the access of these products, but also a link must be established with new importing companies that require these products. From the experience we have as Amcham Guayaquil, we know that different strategies and actions must be considered with the management of the private sector and support from the Government, since there are many competing countries in Latin America that are in the same situation and that some have government support, as well as with tariff preferences and access to markets through trade agreements that Ecuador does not have today. We are in a crisis in which immediate and timely actions must be taken to deal with it, a contingency plan must be implemented for the business sector.
Binational business organizations, what role do they play in a crisis like this?
The binational chambers seek commercial opportunities for our partners in the destination markets, in the case of Amcham Guayaquil, considering that the United States is the main destination market for Ecuadorian non-oil exports, representing 22.07% of the total of these exports. During 2022 we will continue to expand bilateral business towards our main trading partner. Additionally, in these weeks business organizations have met with each other to analyze different strategies to implement, just as we have held meetings on different occasions with authorities from the Ministry of Production, Foreign Trade, Investment and Fisheries and the Foreign Ministry with the aim of look for alternatives to deal with this crisis.
Did many American companies leave Russia, something unprecedented in the international sphere?
The current situation has led several companies worldwide to make this type of decision to ensure the safety of their employees and express their dissatisfaction with the actions carried out. Now the speed of information, the global aspect of many brands and our dependence on technology mean that this crisis is experienced in a different way. For this reason, we advise our entrepreneurs and the Ecuadorian production sector in general to strengthen their technological systems and expand their connections with the markets we already have, such as the United States, Ecuador’s first trading partner. (I)
Source: Eluniverso
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