Exports from Nicaragua, Coffee, Trade
Nicaraguan exports include coffee, beef, shrimp, lobster, tobacco, sugar, gold and peanuts. Export from Nicaragua has improved since the establishment of the Central America-Dominican Republic Free Trade Agreement or CAFTA-DR.
What is the CAFTA-DR? This is a detailed trade agreement between the United States, Nicaragua, the Dominican Republic, Honduras, Costa Rica, Guatemala and El Salvador. The agreement was approved by the United States congress in July 2005. It was signed as law by the President on 2 August 2005. The export zone of this agreement will the second biggest free trade area in Latin America for the United States. A free trade zone is a geographical area where countries can import and export duty free. Nicaragua’s export partner percentages are approximately:
United States 34.9
El Salvador 14.5%
Costa Rica 6.7%
Exports from Nicaragua amounted to $1.55 billion f.o.b. in 2005. This amount includes the free trade zones. In 2004, 79 783 metric tons of green coffee were exported from Nicaragua at a value of 126 773 (000 US$). Coffee makes up the largest portion of Nicaragua’s exports and employs over 100 000 Nicaraguans. Unfortunately, the Nicaraguan coffee market has suffered certain blows in recent years. With the World Bank encouraging Asian countries to export more coffee so that they can pay their debts, the world coffee market has become glutted. This has resulted in a drop in coffee prices. Should this drop in coffee exports continue, many Nicaraguans could lose their jobs. Certain organizations have been promoting Fair Trade Coffee campaigns which will hopefully receive support and improve Nicaragua’s coffee export situation. Nicaraguan export percentages according to products are approximately:
Shrimp and lobster 11.4%
With the assistance of trade agreements and other efforts, the export of Nicaraguan products and raw materials is sure to improve in the future. It is hoped that, along with the increase in exports from Nicaragua, there will also be an improvement of the economy in general and a decrease in unemployment.