On 8 September 2019, Cuba’s Minister of the Ministry of Commerce and Foreign Investment with Lao representative visited Phan Phet Agriculture Development Co. Ltd. The visit aimed to explore and study the possibility to export 100,000 tons of rice to Cuba. Additionally, in appreciating an official visit of the President of the Lao National Assembly to Cuba in early 2019 and expanding economics, trades and investment cooperation between the two countries.
Cuba is located in the middle of South America and North America, has the Arctic Ocean which connects to the European countries and has a population of 11.46 million. Laos and Cuba have been in diplomatic relations since 1974, and the main export of Laos to Cuba is clothes. Tourism is the main industry in the growing economy of Cuba and the main imports are tobacco, sugar, white gold, coffee, and the pharmaceutical industry.
According to Table 1, the value of Lao rice exports over the last five years has shown that the highest export rice was Vietnam at US$ 70 million, China at US$ 40 million and Belgium at US$ 11 million. Since the 2015-2019, Laos exported rice more than 30 countries around the globe such as Asia and Europe, with the total import value was more than US $ 136 million.
Table 1: the Export value of three main countries, since 2015-2019.
Table 2: Export value to European countries, since 2015-2019.
Table 2 shows that over the last five years (2015-2019) Laos exported rice to many countries in Europe. However, the value of exporting rice to Europe was smaller than the value of export rice to neighboring countries. That is shown that there are more demands of rice from neighbors such as China and Vietnam are still high. This is means that exporting rice to Europe or Cuba is still a small demand by comparing to the potential of Laos in exporting rice.
By 2020, the government has targeted to produce 4.7 million tons of rice per year, with domestic demand of 2.5 million tons (for consuming 2.1 million tons and 400,000 tons for stocks). 500,000-600,000 tons for domestic production and a minimum of 1 million tons for export. In 2020, Laos has the potential to be ready to export to Cuba with a goal of 100,000 tons, or 10% of total rice exports.
However, exporting rice to Cuba will be more challenging for the assigned company to research the elements required for the production of the commodity, especially for capital raising, land acquisition, sophisticated technical techniques, adequate mechanization, and access to adequate and reliable agricultural techniques. Pest outbreaks and natural disasters can be threatened. Thus, the above challenges are requested high cooperation between government and private sectors which are relevant to this project.
Sources:
Vientiane Mai newspaper: https://www.vientianemai.net/khao/22310.html
Ministry of Agriculture and Forestry: http://www.maf.gov.la/
Ministry of Foreign Affairs: http://www.mofa.gov.la/index.php/lo/2015-04-07-02-45-52/1950
About Cuba: https://countrymeters.info/en/Cuba
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