2023 continues to bring new challenges for the new government and exporters. Added to the fight against organized crime and economic reactivation are, at a minimum, solutions for the energy crisis, the solvency of the IESS, the fiscal deficit for 2023 and the financing needs for 2024. With these pressures, the new government and Ecuadorian exporters will have to find solutions to the challenges that global competitors set up for Ecuadorian export.

This year, exports suffer attacks on two fronts that determine their competitive strength: in perceived value and in cost of delivery. Meanwhile, according to several sources, 2024 appears to bring moderate to low economic growth for the countries and regions that are our main markets: China (4.5%, moderate for China), the US (1.8%) and the Eurozone ( 0.9 %).

In terms of perceived value and most of our primary exports, the perception of value is driven by supply and demand. This year, the unit prices in exports fell, especially for oil and shrimp, compared to 2022. The exceptions are bananas and cocoa beans, which are among the most representative of our export offer. Banana growers are having a better year than last, and cocoa growers are having a healthy year, especially because of the African supply crisis. In any case, by August 2023 (according to the Central Bank of Ecuador), Ecuadorian exports went from $22.23 million FOB for 20.98 million tons in 2022 to $20.35 million FOB for 20.78 million tons in 2023 A decrease in value of 7.62%. From what we have seen from August so far, this scenario is unlikely to change.

The unit cost of exports has increased. Increasing security costs, increasing financing costs, the repeated absence of tax refunds that are eventually exported, the energy crisis, the withdrawal of fuel subsidies for shrimp farmers, the technological backwardness of the public oil infrastructure, among other causes, have increased the unit price of what Ecuador exported in 2023.

Therefore, it is urgently necessary to review the competitive strategy of our export sectors. As the case may be, creative ways will be needed to maintain bargaining power over an offer influenced by its perceived value and triumph over competitors with lower relative costs than ours, through goals such as: dependence more on ourselves than on product volatility. primary; to generate strategies for greater productivity and perceived value in each production chain; to make trade agreements with China and South Korea to sell more and better; that we know how to build and position sector brands in markets with the greatest potential; that specialized production resources can be provided to smaller exporters (financing, technology, market information, etc.).

Continuing to create an advantage is the only way. (OR)