The proposed DR-CAFTA free trade agreement would provide more opportunities for Georgia's small- to medium-sized companies to conduct business in Central America, according to Georgia businesspeople at a forum held at the Metro Atlanta Chamber of Commerce last week. The U.S. Congress is expected in the next few months to vote on the agreement, known as the Dominican Republic-Central American Free Trade Agreement (DR-CAFTA), that would reduce tariffs on U.S manufacturing and agricultural goods entering the region and encourage foreign investment. Representatives of Georgia companies already doing business in the region participated in a panel at the event, which drew ambassadors and officials from Costa Rica, Dominican Republic, El Salavador, Honduras and Guatemala. Nicaragua, which is also a participant in the agreement, did not have a representative. Juan Chiarella who has worked in Latin America for more than 40 years and is currently president of FJC International Inc., a company that specializes in the import and export of poultry processing equipment, underscored the importance of DR-CAFTA in establishing trust between the region and the U.S. "You cannot go there and move out," Mr. Chiarella said. "The fact that you can sell and move out is the worst thing. To stay and remain and build trust is very important." He also said that companies in the region had made investments to be globally competitive. For instance, he cited the high degree of compliance with the most exacting sanitation regulations in the poultry industry, exceeding compliance in the U.S. "Latin America is ready to meet the needs that the world demands in sanitation," he said. Caroline Hofland, president of Suwanee-based CBH International, Inc., a company that exports U.S. equipment and supplies to agricultural clients in Ecuador, Honduras, Guatemala, Chile, and Peru agreed that the region had developed substantially during the past 10 years. "The technology is so much better than it was. Everybody is tied into the Internet, and it is so much easier to keep up with the documentation," she said.
Ms. Hofland is hopeful that DR-CAFTA will pass because, while the Internet has helped her keep up with documentation, lengthy customs procedures and "rules of origin," regulations have slowed down her business in the past, and DR-CAFTA proposes to streamline and simplify those procedures.
She explained what would happen if one of her clients received specialty curtains, which are used in the insulation of chicken coops, without specific documentation stating that it had been assembled in the U.S. "The business just stops," she said, "and time costs money."
Arturo Sanchez, American-born businessman and former chairman and CEO of Planning Technologies Inc., a company that deals with communications network systems integration, felt that it was important for Central America to attract more U.S. investment because apparel companies and others such as those operating call centers were highly sensitive to cost pressures.
He criticized Costa Rica for losing its cost advantage and that other countries including Argentina and China were increasingly attracting companies away from the region.
Werner Bieri, president and CEO of Buhler Quality Yarns Corp. exporter cotton textiles to Latin America for assembly, believes that DR-CAFTA will "encourage North American investment" in Central America and will be very important to the textile industry. "Free trade is vital for industry here," he said.
For more information, contact Abby Smith at (404) 214-6904.