JUAN CARLOS BARUJA Minister of Agriculture & Livestock - PowerPoint PPT Presentation

Panel III: PARAGUAY AS FOOD PRODUCTION PLATFORM JUAN CARLOS BARUJA Minister of Agriculture & Livestock – PARAGUAY Berlin’s International Green Week January 20 th 2017

Minister of Agriculture & Livestock Paraguay

¿Where is PARAGUAY? Producer and exporter of Paraguay, in the center of South America, landlocked country. agricultural production and electric power

Surface Area: 406.752 km 2 Population: 6.568.000 � 50%=15-49 year-old � 37% <15 years old MILLENIUM ASSETS: FOOD+WATER+ENERGY Western Region or CHACO (62%) ≈ Size New Zealand � < 3% population � Eastern Region (38%) Livestock (45%): � ≈ Size United Kingdom � (Natural Beef) 97% population � Agriculture (99%) + Livestock � (55%)

PARAGUAY ON THE WORLD 3º 3º 4º 4º 4º 2º PRODUCTOR MOST EXPORTER WORLD EXPORTER OF BARGE FLEET EXPORTER OF 1º PRODUCTOR OF CASSAVA STARCH AND EXPORTER OF SOY OIL SOY STEVIA OF YERBA MATE RENEWABLE ENERGY 5º 5º 6º 6º 10º MOST WORLD MOST EXPORTER MOST EXPORTER MOST MOST EXPORTER EXPORTER OF SOY OF BEEF OF CORN EXPORTER OF OF WHEAST EXPELLER SOY PARAGUAY Produces PARAGUAY Produces Food Food for for 100 100 million million People People in in the the World World

Paraguay GDP Share by sectors Agriculture 28 % Manufacturing 13 % Construction 4% Commerce & Services 56% Agriculture Share in Total Country Exports 2010 2011 2012 2013 2014 2015 63,6% 63,6% 63,8% 63,8% 60,9% 60,9% 69,1% 69,1% 69,5% 69,5% 58,7% 58,7%

STRATEGIC OBJECTIVES NATIONAL DEVELOPMENT PLAN PARAGUAY 2030 Poverty Promote Positioning Reduction & Socially Paraguay in Social Inclusive the World Development Economy

SUSTAINABLE PARAGUAYAN AGRICULTURE � Economically Economically FEASIBLE FEASIBLE � Socially Socially INCLUSIVE INCLUSIVE � Enviromentally Enviromentally BALANCED BALANCED

Soy Complex Control of erosion Sunflower Rotación de Canola Cultivo Wheat Floor mail Soy Corn aplication Direct seeding Green manures to protect the soil

Control of the erosion

Crop rotation Soy Soy Crop Crop Wheat Wheat Sunflower Canola

Crops Total Production Paraguay 1995-2016 1995 1995 2016 2016 Growth Growth Crop Crop (000, ton) (000, ton) (000, ton) (000, ton) (x) (x) Soy Soy Soy Soy 2.771 2.771 2.771 2.771 9.110 9.110 9.110 9.110 3x 3x 3x 3x Corn Corn 873 873 5.461 5.461 6,3x 6,3x Wheat Wheat 401 401 1.314 1.314 3,3x 3,3x

Planting Area Paraguay 1995-2016 1995 1995 2016 2016 Growth Growth Crop Crop (000, (000, Ha Ha) ) (000, Ha) (000, Ha) (x) (x) Soy Soy 1.050 1.050 3.264 3.264 3,1x 3,1x Corn Corn 335 335 876 876 2,6x 2,6x Wheat Wheat 201 201 635 635 3,1x 3,1x

PARAGUAYAN BEEF DELICIOUSLY NATURAL ¡A PLEASURE ON YOUR TABLE!

Beef Industry in Paraguay from 2000 – 2015: � National Cattle Herd grew by 49% � Annual Slaughtering increased 4x � Annual Slaughtering increased 4x � Exports (TON/CWE) incremented 6x � Exports Value (US$) beef and by products raised 21x Sour: MAG, 2016

Top 10 World Beef Exporters (‘000 TON CWE) 2016 1600 1400 1200 1000 1000 6 800 600 400 200 0 (Source: USDA, 2016)

Beef Export Growth in the MERCOSUR Years 2003 vs 2014 (US$ Millions) 5570 2003 2014 2014 1547 1405 1244 1049 577 379 57 PARAGUAY BRASIL URUGUAY ARGENTINA GROWTH 21,2x 3,6x 3,7x 1,8x TIMES (x) (Source: Senacsa, 2014, IPCVA 2014, INAC 2014; MAPA, 2014)

Agriculture Total Exports (US$) vs Poverty Index (%) – PARAGUAY 2006-2015 7.000.000.000 50 43,7 41,2 6.000.000.000 37,9 35,1 34,7 32,4 40 34,7 32,4 5.000.000.000 30 30 26,9 23,8 22,6 20,2 4.000.000.000 3.000.000.000 20 2.000.000.000 10 1.000.000.000 0 0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Exportacion Py Indice de la Pobreza Poverty Index Paraguay Exportation Source: BCP, STP, 2016

� PERSPECTIVES

National Development Plan Paraguay 2030 December 2014 PARAGUAY VISION: PARAGUAY VISION: “GLOBAL FOOD PRODUCTION PLATFORM ” ”

In a In a Sustainable Sustainable and and Competitive Competitive Way Competitive Competitive Way Way Way Generating Generating Social and Social and Economic Economic Development Development for for the the COUNTRY COUNTRY

TRIBUTATE REGIME REGIME 10/10/10 LAW 60/90 OTHER INCENTIVES PY AR UR BR IMPUESTOS 0 Import tariff for capital • MAQUILA LAW (Machines) % Corporate ≤10 • LAW OF 35 25% 34% income tax % % CERTIFICATE OF (*) 0 0 ORIGIN + + + + (IVA) Capital goods (IVA) Capital goods (In and out of the country país) % • LAW OF Personal 35 25% 27,5 income tax 10% INVESTMENT % % GUARRANTY DEBT: Tax applie to remittances 0 and capital payments, interest • LAW APP / 5074 and commissions % Value – ≤10 (For inversions> a USD 5MM) 21 • LAW OF FISCAL added tax 23% 25% % % (IVA) RESPONSABILITY EARNING: Divident tax and 0 investment income • LAW OF (For inversions > a USD 5 MM by % (*) Obs: si se distribuye internacionalmente INDUSTRIAL 10 años) puede ser hasta 27.5% PARKS Source: Ministerio de Hacienda (www.hacienda.gov.py

BESIDES OF SGP+ / MAIN COMPETITIVES ADVANTAGES OF PARAGUAY FOR THE COMPANIES % Difference of Paraguay LABOR COST 2014 PRICE OF ENERGY – INDUSTRIAL SECTOR (USD x HORA) – SOCIAL COST Año 2014 (USD x MWH SIN IMPUESTOS) -80% -67% -30% -81% -2% -50% 21,9 308 12,9 124 4,2 6,0 62 63 INCOME TAX VALUE – ADDED TAX (IVA) 2014 2014 -71% -71 % -62% -52% -60% -53% 35% 34% 21,4% 21% 25% 26,3% 10% 10% Source: ANDE, Eurostat, CIER, U.S. Bureau of Labor Statistics, KPMG statistics, Oanda y análisis Arthur D. Little.

AGROINDUSTRIAL POWER TO FEED THE WORLD Paraguay has potential to triple its agricultural frontier with: IRRIGATION IRRIGATION SYSTEMS SYSTEMS SYSTEMS SYSTEMS INCORPORATION INCORPORATION INCORPORATION INCORPORATION OF TECHNOLOGY OF TECHNOLOGY TERRITORIAL TERRITORIAL PLANNING PLANNING

Dr . MARCOS MEDINA-BRITOS vganaderia@mag.gov.py

AGUY AGUY UYJE! UYJE! GRACIAS! GRACIAS! THANKS THANKS THANKS THANKS DANKE! DANKE! INTRODUCCI ON