Daily Archives: July 16, 2013

At last some promising economic news!

Gary Antonio Rodriguez Alvarez writes for El Deber:

More clear… water!

Gary RodriguezI recently read three news in the press that made me smile and do expect a better future for my country, because faith is the last thing you lose! The headline of the first note read: Bermejo sugar mill will achieve $1,300,000 more by exporting sugar (jornadanet.com, 07/04/13). The source was the Minister of productive development and Plural economy, which said that with the authorization granted by the State to export 22,000 tons of sugar to Venezuela, the gain for the sugar mill and Tarija sugar cane producers would imply an additional income of $1.3 million compared with what the internal market would have paid for that quantity. Conclusion: Bolivia WINS much more with the quick release of surplus for export. [thus, quotas should disappear and let the market flow…]

The second headline said: wheat grown surface recorded 30% increase in Santa Cruz (notiboliviarural.com, 07/02/13). The President of Anapo reported that this cereal planting closed easily with 100,000 hectares, opposite to  the 68,000 cultivated in Santa Cruz in 2013, so domestic production would cover this year 35% of demand. “One of the reasons for which asparagus producers decided to increase its surface area is (…)” because the Government, through the food production (public) support company, buy the small grain of wheat at a price higher than the internal market”. Conclusion: it is always better to spend our taxes to encourage a greater domestic production rather than spend them on subsidizing foreign wheat.

The third note entitled public incentive drives up the price of corn. The President of Promasor reported on the rise of this cereal’s 180,000 hectares, in 2012, to 230,000 this year. “Good price of maize makes the producers to be encouraged to cultivate this product,” said a headline. Quintal of corn last year was Bs58, but Emapa set the price for 2013 to a differential Bs90, purchase price that encouraged stocking (El Día, 07/04/13). Conclusion: producing more for the domestic market is possible with an attractive payment, but if the price is artificially low, production falls and we end up importing. [shouldn’t his be enough for current gov to cancel those irresponsible “quotas”??]

‘Lessons learned’ there are in all this, and economists are called to guide – objectively – how to do things right in order to forge the dignified, productive, exporting and sovereign Bolivia that we are eager to inherit our children and our children’s children

Economist and master in international trade

http://www.eldeber.com.bo/vernotacolumnistas.php?id=130709221845