Cover Image
close this bookThe Courier N 127 May - June 1991- Dossier 'New' ACP Export Products - Country Reports Cape Verde - Namibia (EC Courier, 1991, 104 p.)
close this folderDossier
View the document‘New’ ACP export products
View the documentThe fruit and vegetables market in Europe: the case of France
View the documentFinding new markets in the North by Mercedes SILVA
View the documentFlowers and foliage: a blooming market
View the documentKenya - Broadening the range of agricultural exports
View the documentMauritius - successful diversification under adverse condiffons
View the documentZimbabwe - rhe expansion of non-traditional exports: general explanation
View the documentGhana - diversifying the export base problems and strategies
View the documentThe growth of non-traditional exports in the Caribbean
View the documentJamaica - manufacturing: almost exclusively for export
View the documentJamaica’s Preferential Trade Arrangements
View the documentPromoting export of ACP manufactures - The role of CDI

Promoting export of ACP manufactures - The role of CDI

by Berhanu KIDANE

CDI assists manufacturers in the ACP states to promote the export of their products in regional and EEC markets. This responsibility was added to its mandate under the Third Lomonvention.

CDI’s marketing assistance programme covers a wide range of marketing activities. It is a flexible scheme for accommodating ACP requests for assistance of a marketing nature as long as the products to be exported are of ACP origin, are of exportable standard and the manufacturers can guarantee sufficient levels of production to be able to undertake sustained export business.

In general, CDI’s limited resources restrict the extent of its contributions to this end. Its assistance in marketing is therefore geared to responding to practical problems in practical ways, and only as a supplement to the efforts of ACP manufacturers to enter viable export markets: helping them bring their products to competitive export standards, finding markets/buyers and promoting their products.

During the first four years, CDI assisted 70 projects from 23 countries in various types of marketing activities including:

Market surveys and studies; expertise on marketing; market negotiations; product and market evaluation; market testing; product development and upgrading; identification of importers, design of promotional materials and in participation in trade fairs.

Impact of CDI interventions

The impact of CDl’s interventions on exports of ACP manufactures is an exercise than can only be realistically measured in the long term. It will, therefore’ take quite some time for us to know the true effects of our assistance.

Furthermore, whereas the gains of an exporter can be ascertained in the medium term, the gain of CDI’s interventions cannot; because of its limited resources, the foreign exchange earnings of a country resulting from CDl’s assistance are unlikely to be significant enough to justify a comparative assessment.

On the other hand, the feedback from some ACP manufacturers assisted by CDI indicates encouraging financial benefits.

- CDI co-financed a survey of export markets in ten Caribbean countries for a Dominican manufacturer of prefabricated houses and other wood products. The survey provided the Dominican company with basic information about the available markets, local and foreign competition, and the strengths and weaknesses of its products. This led to improvements in quality and the development of new products. Some immediate orders were received while the survey was under way, as a result of contacts made by the consultant. By the end of the year the company confirmed that the survey had enabled it to increase its turnover by as much as 50%.

- A survey of markets in the Arabian Gulf and some African countries for an Ethiopian saltworks resulted in encouraging findings which justified the rehabilitation and extension of its plant. The study provided sufficient data to define the optimum product mixes and the export areas to be targeted.

- A plant in Madagascar which produces children’s fashion clothes and whose participation in a fair was financed by CDI, confirmed that this participation had given its officials professional confidence beyond expectation. Their participation resulted in an immediate order for 2 700 articles valued at FF 477 000 (ECU 68 346) and a prospective order for 3000 articles valued at FF 450 000 (ECU 64 477). They hope to establish for themselves a strong position on the French market.

- A food processing company in Fiji increased its turnover by over ECU I 000 000 (or 21 %) over a period of two years, following assistance which involved a study of European markets.

- Five manufacturers who participated in the Paris Leather Fair (‘Semaine du Cuir’) and the ANUGA food fair in Cologne (Germany), obtained immediate orders exceeding ECU 3 000 000. The long-term benefits are expected to be much greater, including new business contacts which should help them to diversify their distribution channels, Exposure to competitive products enables the participants to assess the improvements required for higher standards.

- Assistance given to an Ethiopian manufacturer for travel in connection with market negotiations has resulted, within the first year, in an increase of his exports by 65% to Europe or by over one million US dollars. The exposure he had during that visit to European buyers also helped him to come up with new products which are in demand in EEC markets.

ACP export potential

The export of manufactured goods is a relatively new phenomenon for ACP countries. Very few manufacturers are engaged in export business and whatever their exports are, they are relatively insignificant. Yet the potential is there. Provided manufacturers do the necessary preparatory work and develop effective export strategies and governments provide appropriate support and adequate incentives, there are rich rewards to be had.

Judging from ACP products displayed at regional and international fairs, ACP manufacturers do produce reasonably high quality goods that could be marketed in the EC with some modifications to meet market requirements.

The EC markets are highly competitive and difficult to penetrate. It is a free market which will be freer and more competitive, come 1993. ACP countries have to come up with the right products at the right prices, select their target markets and develop effective business strategies to enter them.

Once an exporter enters a market, in order to penetrate and maintain his position in it, he has to be informed of trends in competition and kept abreast with changes in fashion and the taste of the consumer. After all, in the final analysis, it is the consumer who determines what to buy and at what price. I Exporters have to kind ways of learning what is going on in the market place. No can do this for them. They have to do it themselves.

It is also important that ACP manufacturers should have affirmative answers to the following questions before indulging in export business:

- Do your products compete successfully against imported products in your home markets?
- How do your products compare with the products already on sale in the target export markets?
- Are your products well packaged?
- Can you offer competitive prices in the market segment YOU want to enter?
- Can you ensure regular supply?
- Can you afford the initial investment required to go into an export venture?
- Are you committed and can you establish the organisational set-up needed for a sustained export business?

Prospects

As stated at the outset, CDI has over the past four years developed a marketing assistance programme which has been beneficial to ACP manufacturers in their export business. The programme has been made known to ACP manufacturers through CDI antennae (representatives) in ACP countries and from time to time through ACP Export Promotion Agencies.

While, in principle, ACP manufacturers can apply directly to benefit from this assistance programme which CDI offers them free of charge, CDI attempts by various means to identify projects to be assisted, including contacting Export Promotion Agencies from ACP countries.

CDI will continue its attempts to reach more ACP manufacturers to ensure that they take advantage of this facility through its antennae or directly from CDI.

As to manufacturers who wish to apply for assistance, the CDI assistance scheme is simple and straightforward. Those who produce exportable quality products in sufficient quantity and are capable of going into and sustaining an export market are encouraged to apply. They have only to complete the relevant CDI forms and send them together with their latest financial statements through the antennae or directly to CDI in Brussels.

In view of the constant changes that are taking place in the world export markets, CDI will continue to develop its marketing assistance programme. Upgrading of marketing skills and marketing of semi-processed goods under sub-contract arrangements are two areas which are presently being explored.

CDI will also develop sectoral approaches which will allow the participation of many manufacturers engaged in compatible products to share their experiences and exchange ideas on common problems. It will also allow CDI to have an overall view of their needs so that integrated solutions can be prescribed.

B.K.