ETG Guyana Action Plan Aquaculture 11Dec05

8/14/2019 ETG Guyana Action Plan Aquaculture 11Dec05

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FAST TRACK SECTOR DEVELOPMENT

COMMERCIAL AQUACULTURE

AACCTTIIOONNPPLLAANN

Prepared for:

Government of Guyana

Inter-American Development Bank

Draft Report

December 2005


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GUYANA FAST TRACK SECTOR DEVELOPMENT (FIRST DRAFT 12/09/05)

Executive Summary

Guyana needs to increase its exports. Export of traditional agricultural and miningproducts are going down. Guyana has to take advantage of its climate, irrigation

facilities and agricultural infrastructure to create economic opportunities for ruralpeople and generate foreign exchange.

Targeting Commercial Aquaculture for Fast-Track Sector Development in Guyanais part of this bold strategy. Up to now, development of Aquaculture in Guyana isoriented mostly to social aquaculture and research and demonstrative activities.

New Line Aqua Farm in the West Bank of Demerara is a private company with astate of the art operation tilapia production facility with 100 acres of ponds,advanced technology, fingerling and balanced food production plant that is trying toprove the potential of Commercial Aquaculture in Guyana.

We are choosing to target and promote aquaculture for four fundamental reasons:

Commercial Aquaculture has a significant economic impact. The incomepotential of an acre of tilapia aquaculture is 25,000 pound per acre and an estimateof US$75,000 in export markets. The development of 1,000 acres can bring up to50-60 million dollars in exports. Even with local markets the economic impact onrural areas is important

Successful experience in other developing countries in the Caribbean andSouth America. Countries as Brazil, Ecuador and Colombia are showing

impressive growth in production and have become leading aquaculture producersin the world.

Guyana agricultural infrastructure provides special advantages tocommercial aquaculture development. The infrastructure developed for riceproduction can be adapted for Commercial Aquaculture in different levels ofinvestment. The cost of developing a 10 acre 5 pond system is estimated inUS$15,000, lower than starting with a greenfield operation in other areas.

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Development of Commercial Aquaculture can be very fast, based ondemonstration projects. The experience in other countries such as Colombia

with successful companies and demonstration projects with economic viabilitycreates a strong investment interest and the sector grows very fast. ETG has hadexperiences such as Tabasco, where growth from one 12 acre shrimp pond tomore than 400 acres of ponds occurred in less than a year.

The Action Plan for catalyzing the growth of Commercial Aquaculture is based onmaking use of the process of successful pioneer project demonstration; focusingon supporting success stories among current producers; the involvement of newproducers with existing producers, or the incorporation of new independentproducers; and setting up a specialized support infrastructure such as specialfinancing and training.

Key elements of the Action Plan Commercial Aquaculture

Proposed Actions CostEstimate

1 Support and Development of Commercial Aquaculture US$100,000

1.1 Demonstration and Support of Pioneer Investors

1.2 Development of Fast-Track Commercial Aquaculture Team

1.3 Involvement of New Private Investors in Commercial FishFarming

1.4 Fast-Track Action Plan for Tilapia Processing Facility

2 Development of Small Commercial and Family Operations US$100,000-

3 Improvement and Conversion of Mon Repos AquacultureStation

US$64,000

4 Designation of Priority Areas for AquacultureDevelopment

US$60,000

5 Aquaculture Development Revolving Fund US$400,000

Total US$624,000

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Expected Results

With the development of Commercial Aquaculture the idea is to help establish andoperate 50 acres of new commercial aquaculture for the first year and get to a levelof 500 acres at the end of five years, with an economic impact between US$25-$30million in new exports.

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Sector Analysis

Aquaculture is one of the fastest growing agricultural activities worldwide. This isdue to a growing demand for fishery products along with a decreasing ocean

fishing supply.Aquaculture creates special competitive advantage in developing countries thathave an ideal climate combined with an abundance of land and water.

Developing aquaculture in Guyana offers the followingbenefits:

Foreign currency income

Increased rural employment

Development of added value through the processing ofproducts

Improvement and growth of regional food supply andnutrition for the poor

Utilization of regional farming and fishery infrastructurealready in place

Increased demand for agricultural products

Developing countries such as Chile, China, Brazil, and Colombia, among othershave experienced a dramatic increase in economic opportunities from developingaquaculture.

The production comes from developing countries.

It is worthy to note the growth of aquaculture production of fish, crustaceans andmollusks in developing countries has exceeded corresponding growth in developedcountries at an average annual rate of 10.4 percent since 1970. In contrast,aquaculture production in developed countries has been increasing at an averagerate of 4.0 percent per year. In developing countries other than China, productionhas grown at an annual rate of 7.8 percent. In 1970, developing countriesaccounted for 58.8 percent of the world production, while in 2002 their share hadrisen to 90.7 percent.

Guyana initiated an effort to develop an aquaculture sector through the creation ofthe Mon Repos technology transfer center. This effort materialized through the

introduction of a new species into the country, as well as the promotion of socialaquaculture by means of training courses and technical support to new operations.This development of aquaculture has focused mainly on the social segment andoriented towards the local and regional markets.Through advanced technology and important investments, Guyana recentlyconsolidated aquaculture operations into commercially profiled export-orientedactivities. Developing this segment through the use of the countrys clear

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competitive advantages, allows for a changeover from a semi commercial andsocial activity to a true economic opportunity for the entire country.

IINNTTEERRNNAATTIIOONNAALL TTRREENNDDSS IINN AAQQUUAACCUULLTTUURREE PPRROODDUUCCTTIIOONN..

In 2002, total world aquaculture production (including aquatic plants) reported to be51.4 million metric tons and US$60.0 billion. This is an annual increase of6.1 percent in quantity and 2.9 percent invalue over reported figures for 2000. In2002, Asian countries accounted for91.2 percent production and 82 percent ofthe value of total world aquacultureproduction. China alone produced71.2 percent quantity and 54.7 percentvalue of the world total.

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The following table shows: the top tencountries producing fish, crustaceans, andmollusks in 2002, and the top tencountries in annual growth throughaquaculture production in 200002. Allcontinents except Europe show increasesin production from 2000 to 2002; inEurope production remained relativelyunchanged (0.1 percent annualdecrease).

2000 2002 APR(per

China 24 580.7 27 767.3 6.3

India 1 942.2 2 191.7 6.2Indonesia 788.5 914.1 7.7Japan 762.8 828.4 4.2

Bangladesh 657.1 786.6 9.4hailand 738.2 644.9 -6.5

rwaTNo y 491.2 553.9 6.2

hile 391.6 545.7 18Viet Nam 510.6 518.5 0.8United States 456 497.3 4.4

op ten subtotal 31 318.8 35 248.4 6.1

est of the world 4 177.5 4 550.2 4.4

Total 35 496.3 39 798.6 5.9

op ten producers in terms of quantity

Top ten producers in aquaculture production: quantityucer

(thousand metric tons)

C

T

R

T

Prod


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Iran (Islamic Rep. of) 40.6 76.8 37.6Faeroe Islands 32.6 50.9 25Lao Peoples Dem.

Rep.

42.1 59.7 19.1

Brazil 176.5 246.2 18.1Chile 391.6 545.7 18Russian Federation 74.1 101.3 16.9Mexico 53.9 73.7 16.9Taiwan Province ofChina

243.9 330.2 16.4

Canada 127.6 172.3 16.2Myanmar 98.9 121.3 10.7

Top ten producers in terms of growth

In South America the most important growth is in Chile and Brazil

Time period Crustaceans Mollusks Freshwater

fish

Diadromous

fish

Marine

fish

Overall

19702002 18.1 7.8 9.6 7.4 10.5 8.9

19701980 23.9 5.6 6 6.5 14.1 6.3

19801990 24.1 7 13.1 9.4 5.3 10.8

19902000 9.9 5.3 7.8 7.9 12.3 10.5

20002002 11 4.6 5.8 6.7 9.5 5.9

World aquaculture production: average annual growth rate for different species

(percent)

Every kind of species is showing important levels of growth.

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AAQQUUAACCUULLTTUURRAALL DDEEVVEELLOOPPMMEENNTT TTRREENNDDSS IINN LLAATTIINN AAMMEERRIICCAA AANNDD TTHHEECCAARRIIBBBBEEAANN

During the last ten years, as a result of new technology and more efficient andeffective production systems, aquaculture has shown important development inLatin America and the Caribbean. Both public and private sectors consider

aquaculture a beneficial and favorable activity.There are no statistics on production results from different types of farming for usto apply intensity criterion that hold a close relationship between amounts investedand the social level of the producers. An estimate based on the farmed specieswith techniques used and the countries in which the farming occurred gives us apicture in which 73% of production is derived from industrial aquaculture and therest is from small scale aquaculture.

Farm production for primarily export products concentrated on salmon in Chile andshrimp in Ecuador, Mexico, Honduras, Colombia, Peru, Panama, and Belize. It isestimated that 90% of the farmed shrimp and salmon, 50% of the Tilapia, and 90%

of the Gracilaria (Chile) are exported. Oysters represent nearly 65% of the regionsfarmed mollusks. Tilapia farming (Colombia, Brazil, Mexico, Cuba, Costa Rica, andJamaica) accounts for the highest growth rate. Carp production (Mexico, Cuba,and Brazil) mainly from two species has also been growing.

During the last 10 years, salmon and shrimp farming for industrial production haveespecially been driving the volume and value growth in the region of aquaculture.The convergence of a series of national and international factors made the sectorsdevelopment possible. At an international level two factors include the trend ofgrowing demand and prices consistency due to globalization contributions(transportation, communications, technological advancements, intensifiedinternational investment flow). The above conditions are major factors in

considering the feasibility of future investments in this sector.Aquaculture is influenced by:

International market trends, risks inherent to the current situation, short saturationterms due to an increase in offer, import restrictions that might emerge and affecttrade of products in markets where producers feel they are disadvantaged by thelow price of imports and costs associated with long shipping distances to markets.

The increase in regional trade of products in Latin America.

Success in avoiding or controlling rapid transmission diseases that can have a verynegative impact on economic outputs, particularly in shrimp farming diseases.

Diseases are being successfully controlled in salmon farming.Preserving adequate conditions for development, including the capacity to renew,modernize, and restructure companies, while developing and implementing newtechnologies that continue positioning high quality products in the markets withouthindering the competitiveness of preserving adequate conditions for development.

Growing concern of citizens about the environmental impact of industrialaquaculture.

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EVOLUTION OF AQUACULTURE IN LATIN AMERICA AND THE CARIBBEAN:Aquaculture in Latin America and the Caribbean showed a growing trend duringthe past decade. While 306,412 metric tons were produced in 1991, in 2000 thatlevel more than doubled (about 871,874 metric tons).

-

500,000,000

1,000,000,000

1,500,000,000

2,000,000,000

2,500,000,000

3,000,000,000

3,500,000,000

4,000,000,000

4,500,000,000

5,000,000,000

1995 1996 1997 1998 1999 2000 2001 2002 2003

VALUE OF AQUACULTURE PRODUCTION IN LATIN AMERICA AND CARIBBEAN (DLLS)

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MAIN AQUACULTURE PRODUCERS IN LATIN AMERICA AND THECARIBBEAN The major producers in the region are: Chile, Brazil, and Ecuadorincluding noteworthy contributions from Colombia and Honduras.

Land Area 1995 1996 1997 1998 1999 2000 2001 2002 2003

Chile 583,868,700 829,186,650 959,759,000 1,001,543,750 923,838,800 1,266,241,200 1,754,904,900 1,688,157,300 2,193,562,400

Brazil 171,896,000 298,378,500 319,427,200 381,000,500 523,876,600 684,396,400 750,043,900 879,225,000 979,451,800Ecuador 633,582,000 647,520,000 678,894,000 729,299,000 598,662,768 321,566,670 267,444,500 277,767,400 297,192,000Mexico 78,992,493 72,843,053 121,259,685 159,290,100 192,016,250 226,221,300 352,974,130 281,926,508 282,015,740Colombia 161,043,200 137,861,815 189,792,600 190,863,300 220,864,400 257,612,400 242,180,000 246,580,000 269,200,800Honduras 46,742,290 69,309,160 63,665,000 43,372,000 44,718,000 49,937,700 67,182,000 78,342,000 104,424,000Peru 44,140,450 60,775,350 49,886,615 42,215,710 65,813,318 37,249,555 45,358,442 71,410,257 80,957,745Costa Rica 35,820,500 35,978,800 36,130,800 35,439,237 38,806,940 32,715,000 35,598,000 65,877,500 69,706,000Belize 7,523,000 6,310,000 9,143,600 9,852,000 15,182,400 17,424,000 33,539,200 30,800,000 64,312,800Venezuela, Boliv Rep of 21,660,000 23,873,000 29,934,740 29,271,737 35,111,412 52,824,853 50,627,364 55,413,456 51,088,575Nicaragua 15,223,000 16,214,350 19,358,650 24,801,150 21,589,350 29,601,660 26,934,660 28,679,190 32,993,550Guatemala 20,933,390 14,513,810 21,220,100 15,257,950 20,110,200 19,341,820 23,731,100 30,021,500 29,131,100Panama 33,617,250 32,097,940 35,930,400 37,873,470 9,834,280 5,894,560 12,352,900 17,955,500 28,261,310Cuba 24,517,660 34,996,860 35,018,810 36,842,950 34,423,140 33,481,500 26,568,000 29,584,200 27,875,000Jamaica 10,816,800 10,666,800 10,516,800 10,396,800 11,796,800 13,578,500 13,578,500 17,044,499 17,355,649Dominican Republic 6,316,979 2,949,600 1,974,500 2,499,300 1,419,500 8,655,800 8,730,260 13,477,140 12,632,980French Guiana - - 144,452 360,000 535,960 463,000 394,019 379,734 7,957,991Argentina 9,220,000 8,737,000 8,497,000 6,660,000 6,770,000 10,395,000 8,162,500 7,676,750 7,152,400El Salvador 1,142,341 942,480 1,096,361 722,166 854,238 1,084,655 1,250,514 2,094,576 4,799,230Puerto Rico 497,320 559,200 99,710 2,117,460 1,815,050 1,925,520 2,794,170 3,016,510 2,237,360

Guyana 554,000 630,000 605,000 576,000 1,219,067 1,173,390 1,197,550 1,197,550 1,197,550Martinique 1,312,377 1,064,655 1,113,543 779,699 614,483 503,694 534,475 770,394 1,089,538Bolivia 1,783,400 1,091,750 1,164,510 1,219,578 1,287,308 1,229,460 672,021 915,720 841,860Suriname 2,000 2,000 2,000 863,000 1,300,000 1,924,000 2,809,600 1,136,400 608,880Guadeloupe 660,000 703,904 411,725 322,000 394,000 238,980 228,626 375,458 587,579Bahamas 60,000 15,000 15,000 15,000 15,000 28,000 182,000 250,000 420,000Uruguay 106,000 144,500 134,300 151,800 277,800 798,100 156,000 93,200 158,808Turks and Caicos Is. 12,000 7,200 9,600 9,600 24,000 36,000 48,000 72,000 60,000Dominica 36,000 36,000 44,000 44,000 44,000 58,500 58,500 39,000 39,000Trinidad and Tobago 30,000 30,000 26,000 26,000 26,000 44,000 17,000 17,000 17,000Saint Lucia 15,300 18,466 17,908 15,059 231,407 3,000 15,481 16,000 16,000Grenada - - - - 6,000 18,000 - - -Netherlands Antilles 10,400 10,400 12,500 12,500 12,500 12,500 13,000 - -Paraguay 300,000 560,000 623,000 224,152 198,217 217,850 234,000 - -Saint Kitts and Nevis - - - - - - - - -

TOTAL 1,912,434,850 2,308,028,243 2,595,929,109 2,763,936,968 2,773,689,188 3,076,896,567 3,730,515,312 3,830,311,742 4,567,344,645

The main producersin Central Americaand the Caribbeanare: Honduras,Costa Rica, Belize,Nicaragua, andGuatemala.

-

500,000,000

1,000,000,000

1,500,000,000

2,000,000,000

2,500,000,000

Chile

Brazil

Ecu

ador

Mexic

o

Colombi

a

Hondu

ras

Peru

CostaRic

a

Beliz

e

Ven

ezuela

,Boliv

Rep

of

Nic

aragua

LARGEST AQUACULTURE PRODUCERS LATIN AMERICA AND CARIBBEAN

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FRESH WATER AQUACULTURE

Production of Fresh Water aquaculture in Latin America and the Caribbean showsthe following trends.

Land Area 1996 1997 1998 1999 2000 2001 2002 2003Brazil 261,243,000 278,794,700 318,836,200 397,910,400 469,777,900 524,608,000 612,965,700 585,965,600Colombia 66,862,527 88,019,100 94,532,500 102,215,000 117,806,000 108,380,000 107,580,000 114,237,600Costa Rica 12,320,250 12,320,250 14,691,196 16,731,379 20,250,000 21,250,000 33,225,000 37,475,000Mexico 5,336,900 9,477,224 10,071,700 14,487,450 19,045,700 29,791,259 31,837,901 31,768,750Cuba 30,391,960 28,168,110 27,525,470 28,842,240 23,394,400 20,298,300 21,349,200 21,555,050Ecuador - 1,799,000 1,799,000 4,049,700 7,183,670 4,742,000 7,001,900 9,727,000Jamaica 10,361,800 10,211,800 10,091,800 11,491,800 13,502,500 13,502,500 14,875,199 8,642,859Guatemala 5,891,800 6,301,100 4,677,900 9,292,200 7,777,360 8,113,000 8,113,000 8,113,000French Guiana - - - 48,960 42,000 59,197 166,884 7,873,151Honduras 281,500 485,000 1,012,000 1,584,000 1,019,700 1,866,000 3,000,000 5,262,000Dominican Republic 695,600 1,086,700 1,516,200 1,235,500 3,116,800 2,293,100 2,862,980 2,862,980El Salvador 105,911 163,366 372,587 263,485 159,908 61,808 873,319 2,855,195Venezuela, Boliv Rep of 6,205,000 8,659,893 8,277,258 8,296,463 7,489,595 12,783,499 10,060,959 2,137,015Peru 183,600 143,046 324,855 292,330 136,594 353,300 568,495 1,369,889Argentina 65,000 65,000 - 1,365,000 3,880,000 1,350,000 1,222,750 862,500Guyana 288,000 255,000 216,000 764,353 718,170 711,550 711,550 711,550Puerto Rico 114,720 27,120 27,120 13,560 69,150 888,070 921,290 450,460Panama 236,940 250,400 126,750 985,000 1,264,000 1,655,400 702,000 178,310Bolivia 191,750 156,750 148,058 158,332 145,594 142,275 181,000 156,860

Martinique 101,675 64,332 63,562 53,589 47,310 46,786 49,570 59,275Guadeloupe - - - - - - 12,109 28,959Trinidad and Tobago 30,000 26,000 26,000 26,000 44,000 17,000 17,000 17,000Saint Lucia 3,256 5,698 2,849 3,259 3,000 3,259 8,000 8,000Uruguay 9,500 9,500 6,000 6,000 6,000 6,000 4,200 6,954Bahamas - - - - - - - -Belize 574,000 285,600 - - - - - -Dominica 8,000 8,000 8,000 8,000 10,500 10,500 - -Grenada - - - - 1,500 - - -Nicaragua 31,150 20,250 6,750 16,000 57,600 153,600 - -Paraguay 560,000 623,000 224,152 198,217 217,850 234,000 - -Suriname 2,000 2,000 2,000 100,000 247,000 86,400 86,400 -

TOTAL 402,095,839 447,427,939 494,585,907 600,438,217 697,413,801 753,406,803 858,396,406 842,324,957

Brazil and Colombia are the most important producers in this area.

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TILAPIA PRODUCTION (METRIC TONS) Tilapia, one of the leading species infresh water aquaculture shows the following trends.

AQUACULTURE PRODUCTION OF TILAPIA (TONS)Land Area 1995 1996 1997 1998 1999 2000 2001 2002 2003

Brazil 12,014 15,700 16,845 24,062 27,104 32,459 35,830 42,003 62,558Colombia 16,057 14,026 16,112 17,665 19,842 22,870 22,500 23,000 23,403Costa Rica 3,800 4,100 4,100 5,398 6,588 8,100 8,500 13,190 14,890Ecuador - - 1,730 1,730 4,400 9,201 5,159 6,903 9,727Mexico 1,482 4,800 8,318 5,398 7,023 6,726 8,845 7,271 7,271Honduras 172 210 212 506 792 927 1,244 2,000 3,508Jamaica 3,500 3,450 3,400 3,360 4,100 4,500 4,500 6,000 2,513Guatemala 774 1,751 2,074 1,647 3,352 2,361 2,501 2,501 2,501Dominican Republic 985 177 344 446 445 994 1,666 2,084 2,084El Salvador 196 93 138 278 141 56 29 405 654Cuba 2,096 2,418 1,888 540 1,060 730 480 500 650Guyana 160 160 170 180 369 369 370 370 370Peru - 46 49 85 60 47 225 121 112Venezuela, Boliv Rep of 1,650 1,700 1,936 2,010 2,320 970 1,250 560 108Panama 186 115 102 55 634 900 1,181 500 95Puerto Rico 48 24 6 6 3 15 199 203 71Bolivia 70 55 40 30 30 30 30 35 39Martinique 30 13 10 10 10 8 8 8 8Trinidad and Tobago 15 15 13 13 12 21 6 6 6Argentina - 10 10 - - 10 - 3 5Guadeloupe - - - - - - - 2 4Saint Lucia - 1 2 1 1 1 1 2 2Bahamas - - - - - - - - -Belize 14 287 136 - - - - - -Dominica 2 2 2 2 2 3 3 - -Grenada - - - - - 1 - - -Nicaragua 5 52 45 15 16 24 64 - -Paraguay 80 150 210 38 38 40 40 - -Suriname 1 1 1 1 50 130 54 54 -

TOTAL 43,337 49,356 57,893 63,476 78,392 91,493 94,685 107,721 130,579

SOURCE: FAO

-

10,000

20,000

30,000

40,000

50,000

60,000

70,000

Brazil Colombia Costa Rica Ecuador Mexico

1995

1996

1997

1998

19992000

2001

2002

2003

TILAPIA PRODUCTION IN TONS

Brazil went from12,000 tons in 1995 tomore than 62,000 tonsin 2003. Colombia andCosta Rica are alsoleading producers.

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VALUE OF AQUACULTURE PRODUCTION OF TILAPIA, Value Production ofTilapia in Latin America and the Caribbean is more than 361 million dollars.

TILAPIA AQUACULTURE PRODUCTION (VALUE) DOLLARS

Land Area 1995 1996 1997 1998 1999 2000 2001 2002 2003Brazil 42,049,000 54,950,000 57,273,000 79,404,600 89,443,200 107,114,700 114,656,000 134,409,600 200,185,600Colombia 52,988,100 48,726,319 53,169,600 56,528,000 61,510,200 70,897,000 67,500,000 69,000,000 70,209,000Costa Rica 11,400,000 12,300,000 12,300,000 14,691,196 16,731,379 20,250,000 21,250,000 32,975,000 37,225,000Mexico 846,933 2,724,479 5,345,146 5,398,000 8,778,750 11,770,500 17,941,097 15,807,013 15,778,070Ecuador - - 1,730,000 1,730,000 3,960,000 7,084,770 4,643,100 6,903,000 9,727,000Jamaica 10,500,000 10,350,000 10,200,000 10,080,000 11,480,000 13,500,000 13,500,000 14,875,199 8,642,859Guatemala 2,263,000 5,250,850 5,911,000 4,649,200 9,237,500 7,683,650 8,014,200 8,014,200 8,014,200Honduras 223,600 220,500 424,000 1,012,000 1,584,000 1,019,700 1,866,000 3,000,000 5,262,000El Salvador 159,983 103,254 160,466 364,737 254,485 159,908 61,808 863,261 2,851,547Dominican Republic 2,142,549 348,400 661,700 989,900 805,000 2,186,800 1,662,700 2,074,180 2,074,180Cuba 1,572,000 1,789,320 1,661,440 469,800 922,200 657,000 432,000 450,000 585,000Guyana 288,000 288,000 255,000 216,000 342,478 343,170 369,550 369,550 369,550Puerto Rico 234,720 114,720 27,120 27,120 13,560 69,150 875,600 899,290 312,400Venezuela, Boliv Rep of 3,960,000 4,165,000 5,553,609 4,771,338 4,988,463 2,140,305 3,109,500 1,324,960 234,360Peru - 92,000 98,000 170,000 120,000 48,483 225,000 223,728 169,044Panama 186,000 126,500 122,400 68,750 951,000 1,260,000 1,653,400 700,000 122,310Martinique 192,495 101,675 64,332 63,562 53,589 47,310 46,786 49,570 59,275

Bolivia 161,000 129,250 83,600 73,305 72,282 67,944 63,570 70,000 50,926Guadeloupe - - - - - - - 12,109 28,959Trinidad and Tobago 30,000 30,000 26,000 26,000 24,000 42,000 15,000 15,000 15,000Argentina - 65,000 65,000 - - 30,000 - 6,000 8,500Saint Lucia - 3,256 5,698 2,849 3,259 3,000 3,259 8,000 8,000Bahamas - - - - - - - - -Belize 35,000 574,000 285,600 - - - - - -Dominica 8,000 8,000 8,000 8,000 8,000 10,500 10,500 - -Grenada - - - - - 1,500 - - -Nicaragua 10,000 31,150 20,250 6,750 16,000 57,600 153,600 - -Paraguay 120,000 225,000 357,000 89,661 79,287 84,000 84,000 - -Suriname 2,000 2,000 2,000 2,000 100,000 247,000 86,400 86,400 -

TOTAL 129,372,380 142,718,673 155,809,961 180,842,768 211,478,632 246,775,990 258,223,070 292,136,060 361,932,780

The growth of the Tilapia Industry in Brazil, Colombia and Costa Rica are successstories from a combined level of 100 million dollars in 1995 to more than 300million dollars in 2003.

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THE CASE OF A DEVELOPING COUNTRY: NICARAGUA

Nicaragua has concentrated its shrimp farming efforts in the Chinandega area.This high social impact activity has maintained a growing trend seen in followingindicators:

AQUACULTURE EXPORTS: Exports of aquaculture products have grownsignificantly in the country. In 2002 they accounted for 30.5% of fishing exports.The contribution of aquaculture to fishing exports showed significant growth in1995 with constant growth each year since.

THE CASE OF A DEVELOPING COUNTRY: COLOMBIA

Colombia started in 1984 with the introduction of Tilapia. In 1986 the AquacultureAssociation was created based mostly on shrimp. In 1986 in the Valle del CaucaRed Tilapia was introduced and the first fingerlings were produced locally. In 1987the first commercial aquaculture enterprise was created, COMPAAVALLECAUCANA DE ACUICULTURA, CVA LTDA, with 16 ponds to produce semiintensive red tilapia. This was the first commercial operation in the country usingcommercial feed, aeration and advanced technology. In 1988 Israeli investors and

local Colombian entrepreneurs started the most important pioneer company inColombia, COLAPIA SA. This operation had 120 acres of productive area and wasconsidered one of the most advanced operations in the world. It introducedfingerling production (2 million per month), aerators, hatchery, processing plant andfish food production in one integral operation. .

From the influence of Colapia a local market was developed and technology wastransferred to Ecuador and Venezuela. The impact of a single company helpeddevelop the tilapia industry in Colombia is reflected in the following productionchart.

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16

0

5000

10000

15000

20000

25000

1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003

TILAPIA PRODUCTION IN COLOMBIA (TONS)


16

0

5000

10000

15000

20000

25000

1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003

TILAPIA PRODUCTION IN COLOMBIA (TONS)


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aquaculture expansion drive. The acreage under aquaculture has expanded, aswell as the number of species being cultured.

On July 13th 2001, Phase 1 of the Mon Repos Freshwater AquacultureDemonstration Farm and Training Centre was commissioned by the President ofthe Republic of Guyana. This facility was constructed as a result of a partnership

with the Food and Agriculture Organisation of the United Nations (FAO-TCP 8922),the Government of Guyana and the Canadian International Development Agency(CIDA).

The four acre (ha) facility has 15 ponds, with a total flooded surface of 0.4 acres,one house and one laboratory office/facility with a staff of three persons (twotechnical and one support staff). Two technical staff are also based at the FisheriesDepartment in Georgetown. The main purpose of the Centre is to stimulate andpromote the development of aquaculture through the training of farmers, providingstart up seed and technical assistance to farmers and to conduct adaptive andapplied research.

Work is presently being carried out on the following species:

Jamaican Red Tilapia

Nile Tilapia (Oreochromis nilotica)

Hassar (Hoplosternum littorale)

Giant Malaysian Freshwater Prawn (Macrobrachium rosenbergii)

It is estimated that about 100 persons are currently involved in aquaculture as a

part time activity. The majority of these persons are involved in brackish waterculture. Aquaculture production for 2001 (1,607.25 mt). I

Cultured Species

Mozambique Tilapia (Oreochromis mossambica)

This species was introduced to Guyana in 1958 from Malaysia. It is of minimalimportance in aquaculture today. Due to crossbreeding with Oreochromis nilotica,

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no pure-bred strains exist today. No further importations have been made since theinitial introduction.

Nile Tilapia (Oreochromis nilotica)

This species was first introduced to Guyana in the 1970s from Cuba. Theanticipated benefits of the initial introductions were hampered by the unplannedcrossbreeding which occurred with Oreochromis mossambica. A more recentintroduction was made in 1999, from stock purchased in Florida, USA. This speciesremains useful, and is presently being evaluated in trials at the Mon ReposFreshwater Aquaculture Demonstration Farm and Training Centre, and by a fewfarmers.

Jamaican Red Tilapia

The first documented introduction to Guyana of this species was in 1999. However,

Fisheries Department staff reported observing this species on the farms of severalpersons in 1998. The Fisheries Department was informed that several importationswere made from neighboring Suriname in 1997. However, this information couldnot be substantiated. A second introduction was made in 2001. Stock waspurchased from Florida, USA, but originated in Jamaica.

Giant Malaysian Freshwater Prawn (Macrobrachium rosenbergii)

This species was first introduced to Guyana in the 1970s. A second wave ofintroductions was made in 2000-2003. Until a successful hatchery is set up, seedstock will have to be continuously imported for grow-out rearing locally.

Hassar (Hoplosternum littorale)

This species is endemic to Guyana. It is an economically important species, whichfetches a high price locally Limited work has been done locally with this species inthe 1970s, and it is presently the object of renewed interest.

Swamp Shrimp (Mesopenaeus tropicales)

This species is endemic to Guyana. It is the main target of the Brackish Water

operations, and fetches a very high market price locally (Table 2).

Important Issues Driving Development

The recent emphasis being placed on aquaculture has been driven mainly by thefollowing factors:

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Decline in the Marine Fishery: Preliminary stock assessments, indicated that thePenaeid shrimp resources have probably reached their maximum sustainable yieldand that a number of commercial fin fish species thought to be under-exploited are

probably being over-exploited.Therefore, aquaculture is seen as a way to produce fish for local consumption, andreduce pressure on the declining marine resources.

Need for Diversification: The rice industry is an important contributor toemployment and a source of income for the rural poor. However, rice productionand exports have been decreasing since 1997. Aquaculture has been proposed asan economically feasible way to diversify from rice and produce another crop thatis marketable and with an adequate rate of return on their investment.

Interaction of Aquaculture

Aquaculture can interact with other sectors, with mutual benefits arising.

Rice Sector: The land structure and arrangement to facilitate rice cultivation canbe easily adapted to aquaculture. This would reduce the initial investment cost foraquaculture, since the modifications required would not be extensive.

Marine Fishery Sector: The marine fishery sector produces an unspecifiedamount of by-catch, especially from the White Belly Shrimp (Nematopalemonschmitti) fishery. This by-catch, which is relatively cheap (US$0.24 per kg) can beutilized in the compounding of feed for aquaculture.

Other Agricultural Sectors. Many sub-products from agriculture in Guyana canbe used in the compounding of feed for aquaculture.

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21

SSTTRRAATTEEGGIICC IIMMPPOORRTTAANNCCEE OOFF AAQQUUAACCUULLTTUURREE IINN GGUUYYAANNAA..

Currently, aquaculture in Guyana is an insignificant activity, and is far fromreaching its potential size. The activity has a lot of potential social and economic

impact.Social impact. Aquacultures main social contribution is to growing the foodsupply, increasing nutrition, and creating more economic balance in low incomerural areas.

Economic impact. Aquacultures main impact is in the creation of rural jobs,generation of exports, capacity for rapid development, facilitation of technologicalprocesses, and use of agricultural products as fish feed.


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22

GGUUYYAANNAASS CCOOMMPPEETTIITTIIVVEENNEESSSS.. WWHHYY AAQQUUAACCUULLTTUURREE IINN GGUUYYAANNAA??

The main competitive advantages Guyana has for developing fish farming are:

AVAILABILITY OF INEXPENSIVE LAND

AVAILABILITY OF IRRIGATION AND WATER INFRASTRUCTURE. Rice andsugar cane production lands already have an infrastructure readily usable foraquaculture development at a low cost.

AVAILABILITY OF UNSKILLED AND FAMILY LABOR

GROWING ENTREPRENEURSHIP AMONG THE GUYANESE PEOPLEFAVORABLE CLIMATE CONDITIONS for certain species that can produce up tothree planned crops per year.


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Some technical estimates for Guyana production are the following:AQUACULTURE IN GUYANA. COMMERCIAL TILAPIA.

TECHNICAL ASPECTS25,000 POUNDS PER POND PER CYCLE

2 ACRE PER POND12,500 POUNDS PER ACRE

2 CYCLES PER YEAR25,000 POUNDS PER ACRE PER YEAR

ECONOMIC ASPECTSPRICE INTERNATIONAL 3 DOLLAR PER POUNDPRICE LOCAL 1 DOLLAR PER POUND

INCOME PER ACRE INTERNATIONAL 75,000 DOLLARS

INCOME PER ACRE NATIONAL 25,000 DOLLARS

SOURCE: NEW LINE AQUA FARM. 2005

MAIN HINDRANCES FOR DEVELOPMENT OF THE SECTOR ARE:

Lack of experience in the country

Financial requirements for commercial operations

Technical support

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OOPPPPOORRTTUUNNIITTIIEESS FFOORR GGUUYYAANNAA

Guyana has the great potential to become one of Latin America and the Caribbeanleading countries in aquaculture production. Guyanas key competitive areasinclude: adequate climate conditions, hydraulic infrastructure, and abundant low

cost land, which should be complemented with the incorporation of investors andfast track technology transfer processes.

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25

RREECCEENNTT TTRREENNDDSS

NNEEWW LLIINNEE AAQQUUAA FFAARRMM

During 2004 and 2005, the New Line Aqua Farma a company established in theWest Bank Demerara zone showed some development which improved theproductive capacity of the sector. The company invested approximately 2 milliondollars in the development of a Tilapia fingerlings production operation for local andexternal consumption, an operation of 100 acres of production and fattening ponds,as well as a balanced food production plant and Tilapia fillet processing plant (inconstruction).

The entrepreneurs are of Guyanese origin and have carried out an intensive

technology transfer effort. They have been able to implement the set up andoperation of highly automated production equipment.

The companys goal is to have a share of the export markets in 2006 with itsTilapia product, as well as to expand its aquaculture activity acting as supplier ofinput materials and services for other companies and, simultaneously as aconsumer of the products.


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26

MMAARRKKEETT TTRREENNDDSS

The Tilapia market is a growing market. Imports into the United States for threeTilapia products are as follows:

In the fresh fillet market the production of Ecuador, Costa Rica, and Hondurasstands out.

TILAPIA FILLET FRESH U.S. DOLLARS

ESTIMATED 2005 VALUEBELIZE 366,462.00BRAZIL 4,755,712.00CHILE 187,948.00COLOMBIA 440,428.00COSTA RICA 25,986,646.00ECUADOR 68,759,922.00EL SALVADOR 1,496,164.00HONDURAS 37,058,780.00HONG KONG -INDONESIA 159,774.00JAMAICA 149,760.00MEXICO 5,104.00NICARAGUA 539,788.00PANAMA 436,852.00PERU 494,910.00TAIWAN -VIET NAM -SUBTOTAL 140,838,250.00

In the frozen fillet market the production of China, Indonesia, and Taiwan standsout.


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TILAPIA FILLET FROZEN U.S. DOLLARSESTIMATED 2005 VALUE

BRAZIL 21,190.00CHINA 103,152,270.00COSTA RICA 895,720.00ECUADOR 530,306.00GHANA 140,466.00

HONG KONG 105,280.00INDONESIA 29,083,466.00JAMAICA -MALAYSIA 10,632.00NICARAGUA 19,884.00PANAMA 730,730.00SOUTH KOREA 119,514.00TAIWAN 11,296,334.00THAILAND 375,598.00VIET NAM 14,343.00SUBTOTAL 146,495,733.00

THE TILAPIA MARKET IN THE U.S. (FROZEN TILAPIA)TILAPIA FROZEN U.S. DOLLARS

ESTIMATED 2005 VALUECHINA 27,570,732.00COSTA RICA 28,512.00ECUADOR 174,634.00HONG KONG 123,500.00INDONESIA -MACAO -MALAYSIA 14,398.00MAURITIUS -PANAMA 230,358.00PHILIPPINES -SOUTH KOREA 4,870.00

TAIWAN 30,300,800.00THAILAND 233,502.00VIET NAM 252,826.00SUB TOTAL 58,934,132.00

In the frozen Tilapia market, the production of Taiwan and China stands out.

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Action Plan

FFOOUUNNDDAATTIIOONNSS AANNDD GGUUIIDDIINNGG PPRRIINNCCIIPPLLEESS OOFF TTHHEE PPRROOPPOOSSEEDD AACCTTIIOONNPPLLAANN

The analysis of the actions to be carried out by the plan begins with our conclusionthat Guyana has competitive advantages in fish farming.

These advantages derive mainly from the availability of adequate land at low cost,the availability of water control infrastructure, optimal climate conditions for thedevelopment of certain species, and the availability of an industrial and commercialtransformation structure within the current fishing cluster.

GGOOAALL // VVIISSIIOONN

Consolidate export commercial aquaculture as an important sector in export andemployment generation for Guyana. Take advantage of the current competitiveadvantages and promote an impact of the strategy.

IIMMPPAACCTT OOFF TTHHEE SSTTRRAATTEEGGYY

An estimate of the development of a successful strategy is shown at three levels;the first is the successful operation of existing farms.

EXPORT POTENTIAL ACRES EXPORT POTENTIAL TONS GLOBAL ANALYSIS

FIRST LEVEL 100 7,500,000 1,136SECOND LEVEL 200 15,000,000 2,273THIRD LEVEL 300 22,500,000 3,409

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29

PPRREELLIIMMIINNAARRYY SSTTRRAATTEEGGYY

Develop commercial aquaculture as a sector with competitive capacity to penetrateinternational markets, especially with fresh water species (Tilapia, Paku, others)and shrimp farming.

Positioning the commercial aquaculture sector as one of the countrys leadingexporters.

The strategy will focus on supporting success stories among current producers, theinvolvement of new producers with existing producers, or the incorporation of newindependent producers, as well as setting up a specialized support infrastructurewith all types of producers.

DDEEVVEELLOOPPMMEENNTT OOFF CCOOMMMMEERRCCIIAALL AAQQUUAACCUULLTTUURREE

Commercial Aquaculture has considerable potential in Guyana.

A handful of Guyana investors considered investing inaquaculture in Guyana and were discouraged by thelack of infrastructure, poor access to technology, andother factors. However, we have had intensiveinterviews with a few pioneer investors who aregraduating from small pilot operations (selling fish tolocal markets) to larger, fully integrated operationsselling output to international markets. The conditionsfor commercial production of tilapia in Guyana areespecially favorable. One local producer, New LineAqua Farms, began operations two years ago with 50hectares of pilot pond production of tilapia. They haveaggressively developed new technology, exploredmarkets, completed environmental impactassessments, and developed an extensive businessplan. With commercial bank loans, New Line Aqua Farms has now constructed alarge, state-of-the-art fingerling production facility and laboratory, 80 hectares ofnew ponds with robotic feeding equipment, a feed production plant, and is inprocess of constructing a fish processing plant. New Line Aqua Farms, withadditional financing, is expected to complete the fish processing plant and moveinto full scale production during 2006, and begin exporting tilapia to Miami.


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The successful demonstration of the feasibility of tilapia (and other species)production and export in Guyana by one or two early innovators will quickly lead toa large-scale expansion of aquaculture in Guyana, similar to the high growth ratesseen in neighboring Brazil and Colombia and elsewhere in Central America.

ETG/IGT recommends a Fast-Track Sector Development program for Aquaculture

in Guyana.The basic elements of the plan are as follows:

Development of Commercial Aquaculture

Demonstration of the Success of Pioneer Investors

Development of a Fast-Track Commercial Aquaculture Team

IInvolvement of new private investors in the fish farming sector of Guyana

Development of Family Commercial Operations

Support for Mon Repos Aquaculture Station (to upgrade to support commercial

aquaculture)Establishment of Priority Aquaculture Development Zone

Development of Aquaculture Park (Medium term)

Aquaculture Development Revolving Fund

Development of Small Scale and Social Aquaculture

Support for expansion of Mon Repos (to support training and technologydevelopment for small scale operations)

Small Pond Construction Support (Min of Agriculture)Access to loans for poorer farmers in building rustic ponds, use of cages (see Dr.Leslie Chins program with IPED)

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DDEEMMOONNSSTTRRAATTIIOONN AANNDD SSUUPPPPOORRTT OOFF PPIIOONNEEEERR IINNVVEESSTTOORRSS

Guyana government will support early investorin commercial aquaculture because the highdevelopment potential for aquaculture inGuyana can be realized once the initialinvestors can show commercial viability.

The government of Guyana through the Ministryof Agriculture and Go-Invest will provide fast-track assistance to support the first 2-3

commercial aquaculture investors. This supportcan take the form of expediting licensing,support in land acquisition, loan guarantees, support with environmental impactassessments, priority road and other infrastructure development, other businessdevelopment services.

The experience in other countries (Colombia) shows a pattern of a few pioneerinvestors that through successful activities are able to attract new local and foreigninvestors to the sector.

The short term objective to this strategy is to:

Make the first successful shipment of Tilapia from Guyana for export

markets.

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33

IINNVVOOLLVVEEMMEENNTT OOFF NNEEWW PPRRIIVVAATTEE IINNVVEESSTTOORRSS IINN TTHHEE FFIISSHH FFAARRMMIINNGGSSEECCTTOORR OOFF GGUUYYAANNAA..

Guyanas aquaculture development can be expedited to a high degree through theincorporation of foreign, Canadian/Guyanese and Guyanese private investors tothe commercial fish farming segment. The investor involvement process requiresidentifying potential investors, presenting the business opportunity, training andorganizing groups of key individuals to this activity, implementing benchmarkingtrips, and creating a process follow-up.

This activity will be carried out by the Fast Track Commercial Aquaculture Team.

There are several interesting experiences in this arena; one case is the State ofTabasco, Mexico, which in one year went from one operating shrimp farm to morethan 60 farms under construction and operation.


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DDEEVVEELLOOPPMMEENNTT OOFF SSMMAALLLL CCOOMMMMEERRCCIIAALL AANNDD FFAAMMIILLYY OOPPEERRAATTIIOONNSS..

Guyanas aquaculture development can be expedited to a high degree byincorporating rice farming families into the commercial activity.

The idea is to diversify rice farming activity by building from 1 to 5 ponds. A typicalunit will have 5 ponds, every pond with 2 acres to a total of 10 acres. The newproducer will have access to fingerlings and fish food from established producersand access to selling to the local fresh market, local processors, and/or exporters.

Estimated production standards are the following:

FAMILY COMMERCIAL OPERATION5 PONDS

10 ACRES30,000 FISH PER POND

150,000 FISH TOTAL150,000 PRODUCCION IN POUNDS PER CYCLE300,000 POUNDS PER YEAR

30,000 POUNDS PER ACRE PER YEAR


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Estimated costs are:

FAMILY COMMERCIAL OPERATION

PRELIMINARY ESTIMATED COSTS

5 PONDSCONSTRUCTION COST 15,000 US DOLLARS

FEEDING COST 100,000 US DOLLARSFINGERLING COST 25,000 US DOLLARSOTHER COSTS 5,000 US DOLLARSTOTAL COST ONE CYCLE 130,000 US DOLLARS

PRODUCTION 150,000 POUND PER CYCLEPRICE LOCAL MARKET 1 US DOLLAR PER POUNDTOTAL INCOME 150,000 US DOLLARSESTIMATED PROFIT ONE CYCLE 20,000 US DOLLARSESTIMATE PROFIT TWO CYCLES 40,000 US DOLLARS PER YEARSOURCE: NEW LINE AQUA FARM INC. 2005

Farmers will build up to 5 ponds, harvesting one pond every 9 weeks, so that thefamily will have continual income/cash flow balanced over the year.

Development of this strategy will be based on previous negotiation with fingerlingand fish food suppliers and marketers. The first phase this strategy can bedeveloped from the operation of New Line Aqua Farm.

The idea is based on taking advantage of existing infrastructure in rice fields andwill help these producers to diversify.

A preliminary design of ponds based on existing rice field infrastructure follows:

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Following is the estimated economic impact of a successful strategy:

ESTIMATED ECONOMIC IMPACT

ACRES XPORT POTENTIAL U.S. DOLLAR

5 FARMS 50 1,500,00015 FARMS 150 4,500,00025 FARMS 250 7,500,000

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TTEECCHHNNOOLLOOGGIICCAALL IINNFFRRAASSTTRRUUCCTTUURREE DDEEVVEELLOOPPMMEENNTT

Aquaculture is an activity that requires a strong and in-depth technologicalfoundation since it faces continuous technical and scientific challenges.Aquaculture must adapt production technologies to meet the special conditions ofthe country, its different regions, and of each specific farm.

The availability of a local technological foundation that allows for the transferenceof technology to other regions, as well as for the adaptation of productive models tothe local conditions, is one of the key elements of the strategy for the developingaquaculture in Guyana.

IIMMPPRROOVVEEMMEENNTT AANNDD CCOONNVVEERRSSIIOONN OOFF TTHHEE MMOONN RREEPPOOSS AAQQUUAACCUULLTTUURREE

CCEENNTTEERR FFRROOMM AA DDEEMMOONNSSTTRRAATTIIOONN FFAACCIILLIITTYY TTOO AA PPRROOAACCTTIIVVEE AACCTTIIVVIITTYYSSUUPPPPOORRTTIINNGG CCOOMMMMEERRCCIIAALL AAQQUUAAQQUULLTTUURREE..

The Mon Repos Aquaculture station facility has accomplished its goals ofpromoting aquaculture, and carrying out technology transfer processes andexperiments for the introduction of new species into the country.

In order to accelerate aquaculture development towards a competitivecommercial profile, it is necessary to strengthen the physical and humaninfrastructure of the Mon Repo station.

The following goals for strengthening are proposed:

Increase its capacity to give technical support to new aquaculture operationsgenerated in the country.

Increase its fingerlings production capacity to serve both commercial and socialfish farming endeavors.

Increase its capacity to form specialized human resources.


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Proposed improvement areas at Mon Repos station:

Improve its training equipment.

Improve the fish production and transportation equipment.

Improve human resources. Incorporate new back-up technical personnel.

Technological improvement. Benchmark trips to nearby areas.

Estimated cost of this first stage of improvement: US$64,000.

Item Quantity Unit CostUS$

Total CostUS$

Digital Projector 1 $1,500 $1,500Lap-Top Computer 1 $1,500 $1,500Digital Camera 1 $500 $500

ReplacementBroodstock

20 pairs $50 $1,000

MSC. InAquacultureScholarship

1 $40,000 $40,000

Short-Term StudyTours

3 (Jamaica, Braziland Venezuela)

$5,000 $15,000

Fish TransportationEquipment

2 sets of oxygenequipment andholding tanks

$500 $1,000

Aerators 4 $500 $2,000PH and DissolvedOxygen Meters

1 each $600 $1,200

Folding Tables 5 $100 $500Chairs 10 $25 $250

Total $64,450

With more technical personnel and betterequipment, it is possible to achieve more in-depth improvement of the institution on themedium term. The estimated strengtheningcost for this second level is US$200,000.

Estimated cost of the second stage of improvement: US$200,000.

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DDEEVVEELLOOPPMMEENNTT OOFF SSPPEECCIIAALLIIZZEEDD PPHHYYSSIICCAALL IINNFFRRAASSTTRRUUCCTTUURREE..DDEESSIIGGNNAATTIIOONN OOFF PPRRIIOORRIITTYY AARREEAASS FFOORR AAQQUUAACCUULLTTUURREE DDEEVVEELLOOPPMMEENNTT

Certain regions of the world promote

aquaculture development through a modelthat concentrates on farms in a specificgeographical area. This permits scaledeconomies that favor the sectorscompetitiveness.

We propose that Priority Aquaculture Development Areas are established inaccordance with the following plan headed by Go Invest.

Identification of geographical areas with technical and infrastructure characteristicsappropriate for aquaculture activities.

Development of a preliminary master plan on the growth of the aquaculturedevelopment area.

Analysis of the electrical and hydraulic infrastructure, as well as the environmentalimpact caused by aquaculture development.

Identification of appropriate lots.

Promotion of the area among private investors.Assignment of lots to investors after an in-depth analysis of their financial andtechnical capacities.

Centralizing aquaculture activities within an area improves the sectors visibility andfacilitates its promotion to the private sector. It also facilitates access to specializedservices, concentrates demand for feed and fingerlings within a geographical area,and favors technological transfer processes.

For the first PRIORITY DEVELOPMENT AQUACULTURE AREA, we propose theChannel 2, West Bank Demerara Guyana zone, where the New Line Aqua Farmoperates. This will favor the orderly development of the activity.

The users and clients of the priority aquaculture development area will be newinvestors in commercial fish farming, either Guyanese or foreigners.

Estimated cost: $60,000 in planning activities, studies and promotion of the firstzone. Executor: Go-Invest.


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DDEEVVEELLOOPPMMEENNTT OOFF SSPPEECCIIAALLIIZZEEDD PPHHYYSSIICCAALL IINNFFRRAASSTTRRUUCCTTUURREE..CCOONNSSTTRRUUCCTTIIOONN OOFF AAQQUUAACCUULLTTUURREE PPAARRKK

Certain regions in the world have developed aquaculture parks to develop thesector.

Concentrating aquaculture farms within an area is known as aquaculture parks.These parks operate similarly to industrial parks, sharing a common infrastructure,and can be developed by the public or the private sector.

In the case of aquaculture parks development will require the following actions:

Plan area development

Develop master plan

Build roads, channel infrastructure

Provide access to centralized technology

Private seedling production, feed, and processing facilitiesOther specialized services

The idea of an aquaculture park in Guyanamight entail significant costs for a sector thatis just starting to develop, but is a strategythat can be developed over two or threeyears based on more profound analysis.


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DDEEVVEELLOOPPMMEENNTT OOFF AA SSPPEECCIIAALLIIZZEEDD FFIINNAANNCCIINNGG IINNFFRRAASSTTRRUUCCTTUURREE..AAQQUUAACCUULLTTUURREE DDEEVVEELLOOPPMMEENNTT RREEVVOOLLVVIINNGG FFUUNNDD..

One of the limiting factors for fast track development of

aquaculture activity is the lack of a specialized financingstructure that makes it possible to build and efficientlyoperate new operations that supply existing farms or newindependent operations.

In Guyana, the availability of working capital in appropriateamounts required for this activity is one of the key costelements, along with the availability of land with adequatecharacteristics.

We propose constituting a revolving fund of working capital dedicated toaquaculture which supplies new investors with resources for the construction of

ponds, and the purchase of fingerlings and feed to cover complete productioncycles.

This new financing mechanism can be funded by international donors (IDB, CIDA,USAID), and managed by commercial banking institutions, negotiatingmaintenance and increase of the revolving fund for the medium and long term.

The availability of financing would ultimately impact the formation and expansion ofnew farms creating jobs and income for generations to come.

The financing model would establish a payment guarantee through negotiationswith final product processing and commercializing companies, as well as specialnegotiations with qualified suppliers of fingerlings and special feed.

ESTIMATED FINANCING NEEDS (WORKING CAPITAL 6 MONTHS) U.S. DOLLARS

ACRES FINANCING FOR ONE CYCLE EXPORT POTENTIAL ONE YEAR

5 FARMS 50 625,000 1,500,00015 FARMS 150 1,875,000 4,500,00025 FARMS 250 3,125,000 7,500,000

Estimated cost: US$625,000 to finance 50 acres in one cycle. Several growthscenarios can be handled. The fund can be started with an estimate ofUS$400,000.


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SSTTRREENNGGTTHHEENNIINNGG OOFF TTHHEE SSEECCTTOORRSS KKEEYY IINNDDUUSSTTRRIIEESS..

SSTTRRUUCCTTUURREE OOFF TTHHEE SSEECCTTOORR DDEEVVEELLOOPPMMEENNTT

LLEEAADDIINNGG CCOOMMPPAANNIIEESS // EEXXPPOORRTTIINNGG CCOOMMPPAANNIIEESS.. TTIILLAAPPIIAA PPRROOCCEESSSSIINNGGFFAACCIILLIITTYY

The consolidation of leading companies exporting their product out of the region isone of the key elements to the dynamic establishment of the sector. Theestablishment of one or several processing Tilapia plants should be considered.

The company Aqua Farm has a process project to construct and equip a Tilapia

processing plant for the export market. This plant has not been finished yetbecause the company ran into financing problems.

We propose that the completion of this project be considered as strategic. Thecharacteristics of this project, as well as its financing requirements, should beanalyzed in depth. In addition to credits, other financing options should beevaluated for the completion of the project, including the incorporation of riskcapital and/or capital from local or foreign businessmen, under the modality of anindependent Tilapia farming company.

The establishment of a processing company with the appropriate characteristicswill facilitate access to general markets.

The incorporation of existing sea product processing companies to the aquacultureproduction chain must also be evaluated in this initiative.

Estimated cost: US$30,000. Investment project analysis


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EESSTTAABBLLIISSHHMMEENNTT OOFF KKEEYY SSUUPPPPLLIIEERRSS

The establishment of competitive and efficient supply networks is a key element inthe consolidation of efficient productive chains. For the development of fish farming

for the medium and long term, it will be necessary to consolidate two other keyelements:

FINGERLING PRODUCTION: Currently New Line Aqua Farm has made a stronginvestment in technology toward the establishment of a fingerlings operation. Thisoperation will satisfy the companys own needs, and the needs of new farms in thecountry and of the Mon Repos aquaculture station.

FISH FEED PRODUCTION: There are several producers of this item, among them

New Line Aqua Farm, which produces balanced feed in Guyana. However, as NewLine Aqua Farm does supply the needs of the industry, the general productioncapacity must be improved both in competitive quality and quantity. Thedevelopment of floating fish feed production operations is a sectors must.


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OORRGGAANNIIZZAATTIIOONN OOFF PPRROODDUUCCEERRSS // DDEEVVEELLOOPPIINNGG SSOOCCIIAALL CCAAPPIITTAALL

SSOOCCIIAALL CCAAPPIITTAALL DDEEVVEELLOOPPMMEENNTT AASS AANN EESSSSEENNTTIIAALL EELLEEMMEENNTT TTOO DDRRIIVVEEEECCOONNOOMMIICC DDEEVVEELLOOPPMMEENNTT

The development of the social capital has beenidentified by ETG/ITG as a key element of thesectors economic infrastructure, and one whichis indispensable to advance in the consolidationof economic sectors, especially withinimplementing development strategies andaction initiatives. Due to its importance, thedevelopment a social capital calls for ananalysis, especially in this chapter.

On this basis, ETG/ITG emphasizes its

recommendation to work on a well-structured process focused on the promotionand development of a social capital within the working environment of theaquaculture sector.

Social capital is the capacity of individuals to associate or to work together, ingroups or organizations, in order to reach common goals. Social capital dependson how much every member of a community trusts the others, and on the valuesand rules they share. Developing social capital requires the promotion of valuessuch as personal confidence, the ability to associate, civic conscience, ethics, andother values that predominate in a society. This is the way to drive projects andinitiatives that have a common impact and benefit. Social capital can be increasedin the short term, and it is the only kind of capital that increases when it is used and

decreases when not used.In order to consolidate the growth of social capital specifically within the fishfarming cluster, we propose the following strategies:

Organize benchmarking trips to fish farming operations.

Invite experts to present advances in aquaculture technology.

Invite experts to engage in collaborative learning workshops.

Collaborative learning processes among people involved at various levels fishfarm workers, fish processing workers, field experts, and investors.


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SSUUPPPPOORRTT FFOORR TTHHEE EESSTTAABBLLIISSHHMMEENNTT AANNDD CCOONNSSOOLLIIDDAATTIIOONN OOFFAAQQUUAACCUULLTTUURREE AASSSSOOCCIIAATTIIOONNSS AANNDD OORRGGAANNIIZZAATTIIOONN

This segment is one of the most important areas for the development of

aquaculture in Guyana because the integration of associations or cooperatives,permits members to save in costs, increases their credit capacity, improve theircontracts with suppliers, have access to larger markets, generate scaledeconomies, improve production techniques and, in short, gain from synergy.

We suggest the following strategy: set up a work group of leading producers,businessmen with an interest to invest in the sector, research and training centers,civil servants, and key representatives from the strategic economic infrastructure,to work on the development of aquaculture in Guyana. This work group may evolveinto the formation of a trade union with the following benefits:

Unity and coordination among producers.

Gathering of information about the sector and its opportunities.Lobbying for government and private support in favor of the cluster.

Development of a specialized infrastructure.

Team work.

Technology transfer.

Representatives of the sector in aquaculture health forums.

Consolidating and strengthening these associative models will contribute in greatmeasure to the consolidation of social

capital in Guyana, which is one of thefundamental elements to regionaleconomic development.

Cluster development activities: Studies,lobbying, investment promotion, andfollow-up for six months: US$ 50,000.


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DDEEVVEELLOOPPMMEENNTT OOFF SSMMAALLLL SSCCAALLEE AANNDD SSOOCCIIAALL AAQQUUAACCUULLTTUURREE

The development of small scale aquaculture is oriented to help the diversificationof farmers and contributes to the social benefit of small producers.

Some key actions in this regard are the following:

Support for expansion of Mon Repos (to support training and technologydevelopment for small scale operations)

Small Pond Construction Support (Ministry of Agriculture)

Access to loans for poorer farmers in building rustic ponds, use of cages (see Dr.Leslie Chins program with IPED)


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POLICY OPTIONS

There are several policy options that can favor the development of aquaculture inGuyana, on which we recommend a general analysis:

ENCOURAGE SOCIAL AQUACULTURE OR COMMERCIALAQUACULTURE.

A discussion on this topic involving an economic policy is the dilemma of backingup one or the two other types of fish farming, which can be defined in generalterms as follows:

Social aquaculture: Oriented towards low income population. Low scaledoperations are carried out, generally focused on private consumption and/or salesto local and regional markets.

Commercial Aquaculture: Medium and large investors participate in this activity.Operations are on the medium and large scale using advanced technology. Theseoperations are managed as business operations and ordinarily they export a largeportion or the whole of their production.

In order to reach goals for significant job and foreign currency generation, werecommend focusing efforts on triggering the commercial fish farming sector.

Due to the importance social aquaculture has for the growth of food supply andincrease in nourishment of low income people; one must not forget support

systems for this activity. However, the development of commercial aquacultureincorporates elements that will directly drive social aquaculture.

USE THE EXISTING AGRICULTURAL INFRASTRUCTURE ORCONSTRUCT A NEW ONE.

The historical development of agriculture in Guyana has left a legacy of productivehydraulic infrastructure that is currently focused on the production of rice and sugarcane. This infrastructure can be adapted, at very low costs, to benefit fish farming.

Rice production fields can be adapted at minimum costs for the construction ofponds for Tilapia fish farming and other species.

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This infrastructure generates competitive advantages in relation to other regionswhere investment costs for ponds and all necessary infrastructures are muchhigher.

We recommend the use of the existing infrastructure as a competitive advantagefor the country.

Promote the concentration of farms within a priority fish farming development areaor letting them spread out throughout the country.

Although aquaculture investments and the investors decision play an importantrole in the placement of the farms, the government and investment promoters caninduce the concentration of farms in one priority zone because in this way scaledcompetitive advantages are reached, costs are reduced, and technology transferprocesses are improved.

Our recommendation is to induce the concentration of farms in key areas, even inthe medium term, for the creation of fish farming parks considering medium rangeterms for the establishment of aquaculture parks.

PRIVATE HATCHERY AGAINST GOVERNMENT HATCHERY.

Another policy dilemma related to the production of fingerlings (a key material insupply for the development of this sector) is either to leave it to the government orto specialized private companies.

The implementation of this activity depends highly on the level of development thesector, especially when demand is limited on account of insufficient development.In such a case, the government becomes the main supplier of fingerlings andtechnical assistance. When the industry evolves towards a commercial activity,demand increases along with quality requirements. Due to the latter, the production

by private companies becomes a key element for this activity.Guyana already has a private laboratory with high levels of investment. Thislaboratory must be backed up to promote commercial aquaculture.

FOCUSING ON A SINGLE SPECIES FOR EXP ORT OR ON ACOMBINATION OF SPECIES AND PRODUCTS.

Aquaculture comprises a wide variety of species of both fresh and salt water withdifferent levels of quality and demand. Concentrating on a few species while thecountry positions itself in export markets might be an advisable policy. Thispositioning promotes the consolidation of production volumes in the interest of

international buyers, clarifying the function of the country in the internationalmarkets. Building technological capacities is easier when only a few species areselected.

While the country evolves to higher levels of fish farming development, it willbecome easier to incorporate new species and production models.

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ETG Guyana Action Plan Aquaculture 11Dec05

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