When Protectionism Fails

The Panamanian government's decision to raise the tariff on meat imported from Nicaragua from 3% to 30% to allow local producers to compete has so far shown no clear results.

Friday, February 15, 2019

In September 2018, the Panamanian government decided to establish barriers to the entry of Nicaraguan beef by raising the import tariff from 3% to 30%. This has not had the expected effects, as the prices paid to local producers have not risen.

See "Meat: The Conflict Between Panama and Nicaragua"

Although the immediate effect of the protectionist measures was a decrease in Nicaraguan meat income, prices for producers have registered a negative variation, since between 2017 and 2019 the price paid locally per kilogram of steer meat has fallen from $2.2 to $2.

Eduardo Carles, Minister of Agricultural Development, said to Prensa.com that "... Even when the first measures were applied, local producers informed us that Nicaraguan beef imports were still affecting the livestock sector, because the price of live cattle in the Central American country was much more depressed than that paid in Panama. Since the ministerial resolution became effective, Nicaraguan imports fell by 40%, but the producer price has not been stabilized."

Also see "Beef: Increasing Business with the US"

Euclides Diaz, executive secretary of the National Association of Cattle Ranchers (Anagan), assures that the "... measure adopted by Panama regarding beef imports is necessary, otherwise 'we run the risk of importing poverty from Nicaragua into our fields."

According to CentralAmericaData reports, in the first half of 2018 imports of fresh, chilled or frozen beef from companies in Panama totaled $18 million, of which $8 million was from Nicaragua.

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More on this topic

Meat: The Conflict Between Panama and Nicaragua

October 2018

For Nicaraguan stockbreeders, the imposition of a 30% tariff on beef imports from Panama violates the conditions established in the trade agreement between the two countries.

In Panama, representatives of the Nicaraguan Chamber of Beef Export Plants (Canicarne), reported that the imposition of tariffs and other non-tariff measures for Nicaraguan meat have stockbreeders and industrialists concerned.

More Protectionism

September 2018

To correct alleged price distortions in the local market, the Panamanian government plans to regulate imports of beef from Nicaragua.

The Ministry of Agricultural Development (MIDA)'s plan is to establish new import rules, which will aim to correct the "distortion in the price of beef paid for the local product." 

Panama: Dip in Beef Consumption

August 2018

The farmers' association reports that the annual per capita consumption of boneless beef has fallen from 13.6 kilos to 13.3 kilos.

The National Association of Cattle Ranchers (Anagan) states that the reduction, although slight, is due to a fall in local production and an increase in imports, which may have generated an imbalance in the local market. 

Nicaraguan Beef Potential

September 2013

The country has the conditions to export meat to Europe at the same prices as Brazil, the world's largest producer.

This was stated by Eduardo Cohen, from the Program for Quality Controls and Sanitary and Phytosanitary Measures in Central America, funded by the European Union.

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