Page 1


Table of Contents FOREWORD ...................................................................................................................................................................... TRINIDAD AND TOBAGO/EL SALVADOR PARTIAL SCOPE TRADE AGREEMENT ........................................................... SECTION 1.0: MARKET OVERVIEW ............................................................................................................................... 2 1.1

Introduction ...............................................................................................................................................2

1.2

Population ..................................................................................................................................................2

1.3

Demographics ............................................................................................................................................2

1.4

Climate ........................................................................................................................................................2

1.5

Language ....................................................................................................................................................2

1.6

Hours of Business ......................................................................................................................................2

1.7

Public Holidays .........................................................................................................................................3

1.8

Travel & Transportation ...........................................................................................................................3

1.9

Time Zone ..................................................................................................................................................4

1.10

Currency .................................................................................................................................................4

1.11

Communication.....................................................................................................................................4

SECTION 2.0: ECONOMIC AND POLITICAL ENVIRONMENT .........................................................................................4 2.1

Economic Performance ............................................................................................................................. 4

2.2

Business ......................................................................................................................................................5

2.3

Labour Force ..............................................................................................................................................5

2.4

Political Stability and Structure ...............................................................................................................5

SECTION 3.0: TRADE ENVIRONMENT ...........................................................................................................................5 3.1

Import Statistics .........................................................................................................................................5

3.2

Import Tariffs .............................................................................................................................................7

3.3

Trade Barriers ............................................................................................................................................8

3.4

Prohibited and Restricted Imports ..........................................................................................................8

3.5

Shipping Information ............................................................................................................................... 8

3.6

Trade Agreements .....................................................................................................................................8

SECTION 4.0: TOP MARKET OPPORTUNITIES & PROSPECTS ........................................................................................9 4.1

Aerated Beverages Products ....................................................................................................................9

4.2

Jams and Jellies Products ....................................................................................................................... 10

4.3

Juices ......................................................................................................................................................... 10

SECTION 5.0: MARKET ENTRY STRATEGIES ............................................................................................................... 10 5.1

Using an Agent/Distributor ................................................................................................................... 10

5.2

Joint Ventures/Licensing ........................................................................................................................ 11


5.3

Franchising ............................................................................................................................................... 11

5.4

Selling to the Government ..................................................................................................................... 11

5.5

Employing Staff in the Market .............................................................................................................. 11

SECTION 6.0: SELLING, MARKETING & PROMOTIONS ............................................................................................... 11 6.1

Selling Factors/Techniques..................................................................................................................... 11

6.2

Trade Promotion ..................................................................................................................................... 12

6.3

Advertising .............................................................................................................................................. 12

6.4

Direct Marketing ..................................................................................................................................... 12

6.5

Distribution and Sales Channels ........................................................................................................... 12

6.6

Pricing ....................................................................................................................................................... 13

6.7

Payment Terms ........................................................................................................................................ 15

6.8

Protecting Your Intellectual Property................................................................................................... 15

6.9

Due Diligence........................................................................................................................................... 16

SECTION 7.0: REGULATIONS & STANDARDS.............................................................................................................. 16 7.1

Sanitary Product Registration................................................................................................................ 16

7.2

Product Shipment/Samples .................................................................................................................... 18

7.3

Packaging, Labelling and Marking Requirements ............................................................................. 18

7.4

Temporary Entry ..................................................................................................................................... 18

7.5

Customs Regulations .............................................................................................................................. 19

SECTION 9.0: FINANCING EXPORTS TO EL SALVADOR .............................................................................................. 19 SECTION 10.0: USEFUL CONTACTS ............................................................................................................................ 20 Appendices....................................................................................................................................................................... Appendix I – Minimum Wages .......................................................................................................................... Appendix II – Public Translators ........................................................................................................................


FOREWORD This Market Guide is intended to give Trinidad & Tobago exporters relevant and valuable information for successfully exporting their goods to El Salvador. The information contained therein is based on a compilation of exporTT’s visits to the market, in-market consultant information, and desk research which is cited accordingly. Feel free to contact us at 1.868.623.5507 to discuss your exporting needs.

**********

TRINIDAD AND TOBAGO/EL SALVADOR PARTIAL SCOPE TRADE AGREEMENT On October 10, 2014, after four rounds of negotiations, El Salvador and Trinidad and Tobago successfully concluded the Partial Scope Trade Agreement (PSTA) that will strengthen the trade and cooperation ties between the parties. The legal instrument includes Market Access, Rules of Origin, Sanitary and Phytosanitary Measures, Technical Barriers to Trade, Trade Remedies and Dispute Settlement Disciplines.

Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 1 of 23


SECTION 1.0: MARKET OVERVIEW 1.1 Introduction Whilst being the smallest country in the Central American region, El Salvador is also the most densely populated. Its capital is San Salvador. The country gained independence from Spain on September 15th 1821. Its population and economy was severely affected by the 1980s Civil War. Despite being highly-industrialised, remittances is a many driver for the nation’s economy. Located on the Pacific Ocean coast of Central America, bordering Guatemala and Honduras; El Salvador comprises of fourteen (14) departments.i

1.2

Population

Population: Population Growth

6,125,512 (July 2014 est.) 0.27% (2014 est.)

Median Age

Total: 25.6 years Male: 24.1 years Female: 27.1 years (2014 est.) 74.18 years

Life Expectancy (Source: CIA World Factbook, 2014)ii

1.3

Demographics

Gentilic:

Salvadoran Salvadorian Salvadorean

Ethnic Groups: Religions:

Mestizo 86.3%, White 12.7%, Amerindian 1% (2007 census) Roman Catholic 57.1%, Protestant 21.2%, Jehovah's Witnesses 1.9%, Mormon 0.7%, other religions 2.3%, none 16.8% (2003 est.)

(Source: CIA World Factbook, 2014)

1.4 Climate The weather is tropical on the coast and temperate in the uplands. The rainy season runs from May to October and the dry season runs from November to April. 1.5 Language The official language is Spanish, however Nahua is the language among some Amerindians. 1.6 Hours of Business Business Hours: 8:00 a.m. to 12:00 noon – Siesta (rest) – 2:00 to 4:00/5:00 p.m. Breakfast, lunch and dinner meetings are frequently scheduled.

Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 2 of 23


During Public Holidays, government offices are closed; specifically the entire duration of Holy Week and San Salvador. See Public Holidays below. Additionally, many offices are closed from December 15 to the end of the first week in January. It is therefore advisable that Trinidad and Tobago exporters not visit El Salvador for business purposes during these periods. 1.7

1.8

Public Holidays Month

Day

Observance

January

1

Año Nuevo (New Year's Day)

April

TBA TBA

Maundy Thursday) Good Friday

TBA

Holy Saturday

May

1

Labor Day

August

4

Celebrations of San Salvador

5

Celebrations of San Salvador

6

Celebrations of San Salvador

September

15

Independence Day

November

2

All Soul's Day

December

25

Christmas Day

Travel & Transportation

1.8.1 Airline Travel Main Airport: The Monseñor Óscar Arnulfo Romero International Airport Distance from San Salvador: 50 km Approximate driving time: 45 minutes, dependent on traffic and the time of day Individual Entry Requirements 1. Valid Passport (should not be expiring in six (6) months) 2. No visa required for less than thirty (30) days stay 3. Airline Ticket  Copa Airline (Non-Stop): TT to Panama = 3 hours, 7 minutes; Panama to El Salvador = 2 hour, 5 minutes  American Airline via Miami (Non-Stop): (US Visa required). TT to Miami = 3 hours, 55 minutes; Miami to San Pedro Sula = 2 hours 55 minutes; San Pedro Sula to El Salvador = 50 minutes. Individual Exit Requirements 1. Valid Passport 2. Airline Ticket 3. Departure Tax = US$34.86 which is included in the airline ticket price. Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 3 of 23


1.8.2 Ground Transportation Taxicab services are normally provided within the perimeter of reputable hotels and are reliable. However, the public transit bus service is not recommended. 1.9 Time Zone Central Standard Time UTC/GMT –6 hours Time Difference: 2 hours behind Trinidad & Tobago 1.10 Currency The national currency is the US dollar The current exchange rate is 1US$ = 1US$ Banknotes are available in $= 1; 2; 5; 10; 20; 50; 100; 500;1,000; 5,000; 10,000; 100,000 Coins are available in cents =1; 5; 10; 25; 50; 100 1.11 Communication Calls from Trinidad to El Salvador = 011 – 503 – 8 digit phone number Calls from El Salvador to Trinidad and Tobago = 00 – 1 – 868 – 7 digit phone number

SECTION 2.0: ECONOMIC AND POLITICAL ENVIRONMENT 2.1

Economic Performance Indicator

GDP: GDP per Capita: Growth:

GDP by Sector:

Inflation Rate: Import Commodities Import Partners (2013)

Economic Performance $24.26 billion, USD (2013 est) $3,826.08, USD (2013 est.) 1.6% (2013 est.) Agriculture: 10.84% Manufacturing: 20.17% Industry: 26.95% Services: 62.20% (2013 est.) 0.8% (2013 est.) Raw materials, consumer goods, capital goods, fuels, foodstuffs, petroleum, electricity US, Guatemala, European Union, Mexico, China

(Sources: World Bank 2014; CIA Factbook 2014; EU Trade Directorateiii)

Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 4 of 23


2.2 Business El Salvador ranked 118 in the 2014 Ease of Doing Business report. They ranked 113th in 2013. The main areas of concern are protecting investors (170), paying taxes (165) and enforcing contracts (68). (World Bank Group 2014). iv 2.3

Labour Force

Labour Force:

2.709 million (2013 est.)

Unemployment Rate

6.90% (2013 est.) Agriculture: 21% Industry: 20% Services: 58% (2011 est.)

Labour Force by occupation:

(Source: World Bank 2014; CIA World Factbook, 2014)

2.4 Political Stability and Structure Three powers:  Executive: President and Ministers  Legislative: 84 elected representatives  Judiciary

President

SANCHEZ CEREN (since 1 June 2014)

Political Party

Nationalist Republican Alliance (Alianza Republicana Nacionalista, ARENA)

Presidential Elections

Held every 5 years

SECTION 3.0: TRADE ENVIRONMENT 3.1

Import Statistics

TOTAL TRADE – EL SALVADOR Total Imports (Goods) (USD, 2012 est.)

$9,175,032,209

Imports of goods and services (% of GDP)

45.81%

Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 5 of 23


TRADE PARTNERS #

Top 10 Import Partners

% Share

1

USA

38.5

2

Guatemala

8.8

3

European Union

7.5

4

Mexico

6.9

5

China

6.1

6

Honduras

5.2

7

Costa Rica

2.8

8

Venezuela

2.6

9

Netherland Antilles

2.1

10

Nicaragua

2.0

(Source: EU Trade Directorate)

TRADE COMMODITIES (at the 2 digit HS Code Level; 2013 est.) HS Code (2 digit)

Top 10 Import Commodities

Import Volume ($)000

'27

Mineral fuels, oils, distillation products, etc.

10,771,953

'84

Machinery, nuclear reactors, boilers, etc.

2,030,868

'85

Electrical, electronic equipment

690,723

'39

Plastics and articles thereof

669,620

'87

Vehicles other than railway, tramway

654,612

'60

Knitted or crocheted fabric

401,286

'52

Cotton

393,610

'72

Iron and steel

327,255

'48

Paper and paperboard, articles of pulp, paper and board

311,563

'30

Pharmaceutical products

308,565

(Source: ITC Trade Map 2014)

Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 6 of 23


El Salvador's major import commodities

Import Volume ($)000 27 - Mineral fuels, oils, distillation products, etc. 84 - Machinery, nuclear reactors, boilers, etc. 85 - Electrical, electronic equipment 39 - Plastics and articles thereof 87 - Vehicles other than railway, tramway 60 - Knitted or crocheted fabric 52 - Cotton 72 - Iron and Steel 48 - Paper and paperboard, articles of pulp, paper and board

(Source: ITC Trade Map, 2014)

Foreign Trade with Trinidad & Tobago, 2002-2013 (000 USD)

Exports Imports Balance Total Trade

2009 3,477 48,084 -44,607

2010 2,660 15,138 -12,478

2011 1,879 69,235 -67,356

2012 3,237 28,039 -24,802

2013* 3,915 56,378 -52,463

51,561

17,798

71,114

31,276

51,561

(Source: The World Bank, 2013)

3.2 Import Tariffs Exporters can source information by selecting the “Tariff Online Query� option at http://appm.aduana.gob.sv/sacelectronico/ or by contacting the Export Market Research Centre (EMRC) Department of exporTT.

Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 7 of 23


3.3 Trade Barriers There are few trade barriers that affect the import of manufactured goods, however the barriers may depend on the various product tariffs. 3.4 Prohibited and Restricted Imports Prohibited items include, but are not limited to:  Firearms;  Publications, movies and other forms of media that are immoral, obscene or pose a threat to the political, social or economic order;  Opium with less than 9% morphine, scraps and opium ash;  Any material utilized for smoking the above;  Certain used vehicles (Source: El Salvador: Import (general)) http://www.gistnet.com/cidb-sample/do-vc.import.htmlv

3.5 Shipping Information Shipping goods from Port of Spain may take as little as 5 days to San Salvador, El Salvador. However, from Point Lisas to Acajutla, El Salvador, it may take 27 days. It should be noted that schedules are subject to change and the cost of shipping often fluctuates alongside the price of oil. (Source: Linescape.com & JOCSailings.com)

3.6

Trade Agreements

Multilateral Agreements

Free Trade Agreements

Agreement/Partner(s)

Date of Signature

WTO members

07 May 1995 (Contracting Party to GATT 1947 as of 22 May 1991)

CACM members

13 December 1960

Central America - European Union (Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama)

29 June 2012

Central America - Mexico (Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua )

22 November 2011

Northern Triangle -Colombia (El Salvador, Guatemala and Honduras)

9 August 2007

Taiwan (Republic of China) Honduras, El Salvador

7 May 2007

Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 8 of 23


Partial Preferential Agreements

DR-CAFTA (Central America Dominican Republic - United States)

5 August 2004

Central America - Panama (Costa Rica, Guatemala, El Salvador, Honduras and Nicaragua)

6 March 2002

Central America - Chile (Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua)

18 October 1999

Central America - Dominican Republic (Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua)

16 April 1998

Venezuela (AAP.A25TM N° 27)

10 March 1986

(Source: OAS 2014)

SECTION 4.0: TOP MARKET OPPORTUNITIES & PROSPECTS 4.1 Aerated Beverages Products El Salvador is a net importer of aerated beverages, where the imported value of aerated beverages each year exceeds the value being exported. There were minimal increases in the values of imported drinks from 2007 to 2011, however the exported values of the beverages almost doubled over the five years. In the year 2007, El Salvador imported almost three times as much drinks as they exported but by the year 2011 imports exceeded exports by less than 40%. Six countries were responsible for all of El Salvador’s imports of aerated/soft drinks during 2011. Guatemala was the principal supplier of the imported soft drinks to El Salvador during 2011. The market is very concentrated as Guatemala alone supplied over 95% of the imports. The products are usually transported via road across the border from Guatemala to El Salvador. Of the top exporting countries only Mexico, Spain and USA pay between 10-15% tariffs, while the remaining countries which have free trade agreement with El Salvador pay no tariffs. A total number of seventy-four aerated beverages were observed in the market and 35% of the drinks were imported from Embotelladora La Mariposa which is in Guatemala. The most promising sub-sectors for Aerated Beverages are:  Non-alcoholic beverages (excl. water, fruit or vegetable juices)  Waters including mineral & aerated, containing sugar or sweeting matter or flavored

Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 9 of 23


4.2 Jams and Jellies Products El Salvador is a net importer of jams/jellies. Even though the value imported has steadily declined from 2007 to 2011 with the value being almost 50% less in 2011 as compared to 2007; the imported value of the products each year still exceeds the value being exported. Imports increased slightly from 2010 to 2011. The value of items exported has increased over the five years and by the year 2011 had almost doubled the value exported in 2007. Three countries were responsible for 100% of the imports of jams/jellies into El Salvador in the year 2011; Costa Rica, Mexico and Guatemala. The market is therefore very concentrated. None of the countries pay any tariffs when exporting jam/jellies into El Salvador as they all have free trade agreements with El Salvador. The most promising sub-sectors for Jams and Jellies are:  Jams, fruit jellies & marmalades  Jams, jellies, marmalades, purees or pastes of fruit or nut pastes, obtained by cooking, even with added sugar or other sweetening homogenized preparations 4.3 Juices Statistics reveal that El Salvador has an active trade market for juices whilst research has shown that El Salvador is a net exporter of juices, however, the country imports large quantities of juices from Guatemala and Honduras. The most promising sub-sectors for Juices are:  Other orange juices  Other mixtures, fruit juices, guava (Source: ITC Trademap 2012)

SECTION 5.0: MARKET ENTRY STRATEGIES 5.1 Using an Agent/Distributor Using an Agent/Distributor is recommended for gaining market entry in El Salvador. As with other markets, Trinidad and Tobago exporters should take care in selecting an agent/distributor because it can be difficult and costly to prematurely end a relationship. The relationship between the agent and principal is guided by the Salvadoran Commercial Code which says that any agreement can be terminated by the principal. It also a terms of compensation for agreements that are ended. exporTT advises that all exporters utilise a bi-lingual attorney for preparation and presiding of all contracts and legal matters in the market. A listing of distributors can be found at: www.ades.org.sv . Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 10 of 23


5.2 Joint Ventures/Licensing A joint venture is a contractual agreement in which "a merchant is bound to share, with one or more persons contributing goods or services, the profits or losses arising from one or more of his/her enterprise's operations or its turnover" (Start In Business 2014)vi. Joint Ventures and the use of licenses of Trinidad & Tobago exporters must be legally established in a contract signed by both parties. Both types of relationships are regulated by the Salvadoran Commercial Code. 5.3 Franchising With the growth of the economy and increased investor confidence, discussions on franchises are taking place and opportunities are expected to increase. 5.4 Selling to the Government A listing of government tenders can be found at http://www.globaltenders.com/government-tenders-el-salvador.php

GlobalTenders.com:

5.5 Employing Staff in the Market With respect to employing staff, there is no single national minimum wage, but it varies depending on the sector. One would find that the base salary is lower in the agriculture sector, while it is highest the trade and services sector. See Appendix II.

SECTION 6.0: SELLING, MARKETING & PROMOTIONS 6.1 Selling Factors/Techniques Selling factors and techniques are described in the following five steps to master the selling process. Steps

1. Greeting

2. Ask questions to understand the prospect 3. Present Benefits 4. Handle Objections

Description You need to ‘arrest’ the buyer:  Pay attention to dress, hygiene, grooming, handshake, etc.  Treat the buyer’s business card with respect and present your business card in a professional manner.  Speak clearly, paying attention to voice, tone, eye contact, etc.  Use correct titles and surnames.  Have a positive body language. Don’t ask direct questions but ask leading questions in a conversation type manner to find out the buyer’s need and what he/she is looking for. Present the benefits of your product/s or service/s in a manner that aligns them to the need of the buyer. If the buyer is not interested in your product/s or service/s, don’t end the meeting in despair, remain calm. Instead, take the opportunity to find out more about the market and their needs so

Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 11 of 23


that you can possibly make adjustments to your product to suit their needs. 5. Close

It is very important to know and agree on the next steps which should include a thank you email which captures the essence of the conversation and the activities that would follow.     

Other Tips

Be prepared Know your business and your products Be confident Be a persuasive negotiator Confirm appointments at least 24 hours in advance and be on time.  Prepare your marketing tools e.g. brochures, samples, PowerPoint presentations, etc. and make them come alive with images.  Take notes and bring a note taker.  When using an interpreter, do not speak directly to the interpreter as if the buyer is absent, however keep the conversation focused on the buyer and allow the interpreter to interpret accordingly.

6.2 Trade Promotion Locally, exporTT offers trade promotion programmes periodically, including trade missions, trade shows, trade fairs, matchmaking events, conferences, etc. These programmes are conducted with a pre-approved budget and with an element of co-financing with the exporter for some activities. 6.3 Advertising One of the best ways to advertise in El Salvador is in the newspapers. Also, depending on the target market, magazine advertisement is also effective. Trinidad and Tobago exporters should note that sales catalogues and brochures should be translated into Spanish. Additionally, some retailers use in-store promotions, website advertising and daily specials in the newspapers as part of their sales promotions strategies. It is often expected, however that the distributor will share the advertising cost. 6.4 Direct Marketing Due to a limitation in communications and the mail delivery capacity in El Salvador, it is difficult to engage in direct marketing. However, the telecommunication system is improving the government is also addressing the mailing system. 6.5 Distribution and Sales Channels The import channels are by way of an importer/distributor, and some of the larger supermarkets import the item directly. Some of the wholesalers called “Mayoristas” also import items, but they Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 12 of 23


mainly purchase items from distributors and sell them to their customers as wholesale items. Many items are sold through the “mayoristas� as they are numerous throughout the country and their clients purchase the items to sell in their villages. One owner of a Mayorista explained that they attach a 7% mark-up on their items. There are some other variants to find the end customer, whereby the same channel of trade makes an import without the intervention of an importer/distributor. Nevertheless this type of operation is not preferable to key players like Selectos or Walmart due to the fact that the importing process demands a lot of focus and therefore they have another enterprise making the imports and distributions for them. The following table provides information on each of the major supermarkets; Selectos, Walmart and Hiper Europa: Name Selectos: http://www.superselectos.com/wfsucursales.aspx Owns the Brand: De Todo Walmart: http://walmartstores.com/AboutUs/9754.aspx Owns the Brands: Despensa de Don Juan & Despensa Familiar Hiper Europa

Stores

Market Reach

More than 90 stores

Entire country

2 Hypermarkets 25 Supermarkets 50 Despensa Familiar Total 77 2 Supermarkets

Selected areas San Salvador

During our visit to the market, we were able to visit and assess some distributors or importers. Some were willing to share information about their needs and were also interested in the offer of Trinidad Tobago. Even though the Salvadorian market is a very competitive one, room exists for products from Trinidad Tobago. Buyers are generally interested to hear about a new offer, and if the economics are sufficient, then a market entry should be considered. 6.6 Pricing The main factors that will determine the end price for products include the channel trade margins plus the import Taxes or DAI. Also, VAT is 13% to all products and there are special taxes to be considered when importing alcohol beverages or liquors, cigarettes. An example of a Price Structure is shown below:

Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 13 of 23


Cost Build up Ex work cost Transport Cost from Plant to Port Cost of product FOB Puerto Espa単a Transport Cost 1% of FOB Inssurance CIF 15% DAI VAT Cost for discharging and Ware House Landed Cost of product w/o VAT 18%-22% Margin for Importer / Distributor Landed cost with Importer margin 13% VAT Selling price to trade channel w/o VAT Selling price to channel with VAT 22%- 28% Margin of Channel Trade Selling price to consumer w/o VAT Selling price with VAT

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

1.00 0.03 1.03 0.22 0.01 1.26 0.19 0.19 0.04 1.49 0.33 1.82 0.24 1.82 2.06 0.51 2.33 2.64

We have assumed any exports from Trinidad & Tobago will start with a 20 foot container and will be handled as a consolidated transport, which means that various producer will use the same logistics in order to make more feasible and efficient.

Transport Cost Port Spain to San Salvador Lets assume 20 foot container 8 pallettes each pallette 70 cartons each carton 20 units Cost per unit

$ 2,500.00 $ 2,500.00 $ 312.50 $ 4.46 $ 0.22 $ 0.22

Cost of discharging

$

500.00

20 foot container 8 pallettes each pallette 70 cartons each carton 20 units Cost per unit

$ $ $ $ $

500.00 62.50 0.89 0.04 0.04

Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 14 of 23


Cost to transport fro Plant to Port

$

300.00

20 foot container 8 pallettes each pallette 70 cartons each carton 20 units Cost per unit

$ $ $ $ $

300.00 37.50 0.54 0.03 0.03

6.7 Payment Terms Imports are subject to incoterms, which both parties can freely negotiate among themselves; however, Cost, Insurance and Freight (CIF) is often the preferred option, while several others still prefer to use Free on Board (FOB). While the method of payment can also be freely negotiated between both parties, many importers have indicated a preference to obtain at least 30 days credit. Once the business transaction has been defined, both parties should determine the means and method of payment, opting to have a bank account with banks that have branches or relationships with other banks. In terms of the payment currency, the United States dollar is the preferred currency for trade documents but other currencies are used when necessary. 6.8 Protecting Your Intellectual Property Protection against patent infringement can be implemented by executing administrative and judicial actions. Administrative Actions “These are based on the rights granted by the Intellectual Property Law, which provides that the owner of a patent can stop its unauthorised use by a third party. If the patent was granted for a procedure, use of such patent comprises manufacturing, sales, imports, storage and transit through the country, plus prohibition to use the procedure. The limits to the right of ownership are those mentioned in article 5 of the Paris Convention: private use, scientific investigation, and commercialisation of the patent once its term of protection has lapsed. The Intellectual Property Law provides an opposition procedure enabling the filing of observations to the patentability requirements of a new invention, within two months after publication of the patent extract notice in the Official Gazette. The applicant is granted the right to reply to any observations made by third parties and after analysing both, the Patent Examiner resolves whether or not the patent application moves to the examination phase.� For further reading on this topic, please visit Romero Pineda & Asociados at the following link: http://romeropineda.files.wordpress.com/2012/07/20080314-el-salvador.pdf . (Source: Getting the Deal Through, 2008)vii

Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 15 of 23


Judicial Actions “These may be taken against patent infringement based on the Intellectual Property Law and the Mercantile Code or based on the Criminal Code. Intellectual Property Law and Mercantile Code-based actions must be filed before the Mercantile Courts in the Judicial District of San Salvador or in a court with mercantile jurisdiction in other districts. Criminal actions must be filed before the General Attorney's Office and their prosecution is made before a criminal court. The registration of a patent can be cancelled by filing a complaint before a Mercantile Court in the Judicial District of San Salvador or in a court with mercantile jurisdiction in other districts. Said cancellation action proceeds when it has been granted to a person other than the legitimate owner of the patented invention. The Intellectual Property Law also grants the legitimate owner of a patent, legal actions to re-vindicate it, if registered by an unauthorised third party.� For further reading on this topic, please visit Romero Pineda & Asociados at the following link: http://romeropineda.files.wordpress.com/2012/07/20080314-el-salvador.pdf .

6.9 Due Diligence Before finalizing any contract whether for sale or representation, Trinidad & Tobago exporters should obtain information on the bona fides of the foreign firms including reliable business and financial references. Also, the because of the language difference between Trinidad & Tobago and El Salvador, this presents opportunities for serious miscommunication and misunderstandings and sometimes with grave consequences. Therefore when entering into business with companies from El Salvador, it is imperative to utilize the services of a competent bi-lingual attorney to avoid communication failures.

SECTION 7.0: REGULATIONS & STANDARDS 7.1 Sanitary Product Registration El Salvador is a standards taker and not a standards maker. As such, EL Salvador does not have specific food legislation for imported foodstuffs. Instead, the Health Code is the most widely used tool to enforce local food safety. The Ministry of Public Health and Social Assistance is responsible for all registrations and authorisations to import, manufacture and sell foodstuffs and beverages as well as any raw materials used in the production process. Food imports must be authorised by a certificate of free sale that is certified by the Environment Safety Department. Fresh produce and products of animal origin are regulated by the Plant and

Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 16 of 23


Animal Health Division of the Ministry of Agriculture. The certificate of free sale is valid for one year. Most food products are inspected for safety at the port of entry. However, the Ministry carries out random testing at the retail and wholesale level to make sure that foodstuffs comply with all the required health and quality standards. In order for an exporter to register such products, an application must be filed at the Environmental Health Department with the following information:  Petitioner’s name and address;  Product description;  Name, address and telephone number of the establishment or factory where the product is manufactured;  Product use;  Name, address and telephone of the supplier in El Salvador;  Type of packaging material;  Net content;  Commercial brand name. * If there are different flavours of the drink, each flavour of the drink must be registered. This application must be filed with the following documents:  Power of attorney granted in favour of the El Salvadoran attorneys or the company representative in the country, duly notarised at the nearest El Salvadoran consulate or by notary public;  An original certificate of free sale of the product issued by Trinidad and Tobago health authorities and Apostille. The certificate must be translated to Spanish and duly notarised by an El Salvadoran lawyer;  Functioning licence of the local warehouse where the product will be stored, usually obtained by the local distributor;  Label of the product in Spanish (in various sizes if necessary), which will specify the product name, list of ingredients, name of manufacturer, importer and/or distributor and the expiration date, usage instructions if necessary;  Product samples: See specifications in 6.2 below. Usually when clearing a product through customs, a customs inspector, a customs police officer and a Health Ministry inspector are involved in the process. English is the commercial language used for import documents. On average, it takes approximately 3-5 days to clear a product. Most importers use a customs agent to expedite the clearing procedures. Just to note, the Ministry of Hacienda has implemented a system called “Teledespacho” designed to expedite the customs procedures. This system uses satellite technology to allow importers and exporters to send their commercial invoices. Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 17 of 23


7.2 Product Shipment/Samples Solid Products: 3 samples of the product weighing 200 grams each Liquid Products: 3 samples of the product weighing 200 mls each Alcoholic Beverages: 2 samples of 200mls each Bottled Water: 1 sample of 3.785 litres for the physical-chemical analysis and 1 sample of 3.785 litres for the microbiological analysis 7.3 Packaging, Labelling and Marking Requirements The following are the labelling requirements for products being imported into El Salvador:  Retailers must have the price of the product either on the packaging or in a visible place.  Products that are sold by weight or volume or any other measure must have the weight, volume, or an exact measure of the contents on the label.  Labels on frozen and canned foods must include an expiration date.  Labelling must be in Spanish language. In those cases that the original label is not in Spanish, a complementary Spanish label must be annexed to the product and should comply with all the existing labeling requirements.  Nutrition facts must be stated on the back using the standards set by the USA.  Name and contact information plus phone number of the company responsible for the importing and distribution.  The registration number of the company and also of the product being imported.  When the product is marketed in several presentations, there should be a label for each presentation. It was observed in the market that the soft drinks labels are similar to those in the Trinidad and Tobago market, however most bottles are slimmer and longer than those supplied in this country. Please visit the National Science and Technical Council (CONACYT) for further information on standards and regulations in El Salvador at http://www.conacyt.gob.sv/ 7.4 Temporary Entry Customs allows temporary entry for foreign merchandise, given that it is for re-exporting without modification. They may alter duties at this time. At this time, a bond must be presented. Products to be exhibited in trade shows or fairs are allowed temporary entry, given that they are exported in the condition they arrived to El Salvador. Small, non-commercial imports, equal or lesser in value of USD 500, as well as samples, can enter the country exempt from import duties under Law of Incoming Travellers’ Luggage (Ley de Equipajes de Viajeros Precedents del Exterior). (Source: International Trade Administration, 2012)viii

Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 18 of 23


7.5 Customs Regulations The Customs and Excise Division of the Ministry of Finance and the Economy, Trinidad and Tobago is responsible for approving all exports emanating from Trinidad and Tobago. To export commercial goods, the exporter is required to have a customs broker fill out the required documentation. Commercial and non-commercial exporters must also perform the following actions:  Fill out a Customs Declaration Form (C82 Form) in four copies, which is provided by your broker;  Submit the C82 Form along with other required documents (see below) to a customs officer at a Customs and Excise office for signature;  Take the signed C82 Form and the goods to be exported to the Import/Export station from which the goods are to be exported. The basic documents required for exporting are as follows:  Invoice showing the price paid locally  Export licence (where applicable)  Certificate of origin (where applicable) Please contact the Customs and Excise Division for further information. See Section 10.0.

SECTION 9.0: FINANCING EXPORTS TO EL SALVADOR exporTT Limited provides a Co-financing Services, through which an exporter can be reimbursed (50% reimbursement) for the following market access activities: a. Product Registration b. Trademark Registration c. Product Testing d. Translation & Interpretation Services e. Legal representation for product, brand and trademark registration f. Booth rental at trade shows g. Business to business matchmaking services h. Shipping of samples i. In-store marketing and promotions j. Booth design at trade shows k. Ground transportation for exporTT led groups at trade missions and trade shows l. Brand registration m. Label modification n. Registration at international capacity building forum/workshop Please contact the following person or any other exporTT representative for more information on these services: Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 19 of 23


Mr. Crisen Maharaj Manager- Capacity Building and Programme Financing exporTT Limited 151B Charlotte Street Port of Spain Tel.: (868) 623-5507 Ext. 362 Fax: (868) 625-8126 Mobile: (868) 796-4276 Email: cmaharaj@exportt.co.tt Website: www.exportt.co.tt In addition to local banks, to obtain information on financing exports to El Salvador, please contact: Mr. Shaun Waldron Manager, Credit & Business Development Export Import Bank of Trinidad & Tobago Limited #30 Queen's Park West, Port of Spain Phone: 1-(868)-628-2762 Ext. 288 Fax: 1-(868) -628-9370 Email: swaldron@eximbanktt.com Website: www.eximbanktt.com

SECTION 10.0: USEFUL CONTACTS 10.1 Trinidad and Tobago Office

Contact Information Ms. Roann David Export Officer

exporTT Limited

exporTT Limited 151 B Charlotte Street Port of Spain Trinidad W.I. Tel: 1-868-623-5507 Ext. 226 Mobile: 1-868-477-8031 Fax: 1-868-624-3919/625-8126 Email: rdavid@exportt.co.tt Website: www.exportt.co.tt

Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 20 of 23


El Salvadoran Embassy

Customs and Excise Division

Shipping Agencies

Translation Services

El Salvadoran Embassy in Port-of-Spain, Trinidad and Tobago 29 Long Circular Road St. James Port-of-Spain Telephone: 1-868-628-4454 Telephone/Fax: 1 868-622-8314 Email: cpineda@rree.gob.sv Head of Mission: Mr Raymundo Ernesto Rodriguez Diaz, Ambassador Customs and Excise Division Ministry of Finance Custom House Nicholas Court Cor. Abercromby Street and Independence Square Port of Spain Phone: (868) 625-3311-9 Ext 335-8 Email: policyunit@customs.gov.tt Web: www.customs.gov.tt Shipping Agencies Shipping Association of Trinidad & Tobago 15 Scott Bushe Street, Port of Spain Phone: (868)625-2388, (868)623-3355 Fax: (868)623-8570 Email: om@shipping.co.tt Web: http://shipping.co.tt/member%20search.php?id=1&page=1 A list of official translation and interpreting agencies approved by the Ministry of Foreign Affairs, Trinidad and Tobago can be found in Appendix II.

10.2 El Salvador Office

Chamber of Commerce & Industry

Contact Information Cรกmara de Comercio e Industria de El Salvador 9na. Avda. Norte y 5ta. Calle Poniente Apartado Postal 1640 01118 SAN SALVADOR El Salvador Tel: (00503) 2712055/(00503) 2816622 Fax: (00503) 2226593/(00503) 2714461 Email : camara@camarasal.com Web: http://www.camarasal.com

Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 21 of 23


Trade Point

Association of Exporters

National Trade Promotion Centre

Ministry of Public Health and Social Assistance Regional Customs Integration Standards Council Ministry of Economy Customs Authority

Trade Point El Salvador Res. Santa Elena-Bd Orden de Malta Edificio D´Cora La Libertad SAN SALVADOR CA El Salvador Tel : (00503) 2782204 Fax : (00503) 2782216 Email: tradepointelsalv@minec.gob.sv Email: tpes@minec.gob.sv Web: http://www.tradepointelsalv.com Corporación de Exportadores de El Salvador (COEXPORT) Gerencia de Programas Col. Jardines de Guadalupe Condominios del Mediterraneo 2 05235 SAN SALVADOR El Salvador Tel: (00503) 2433110/(00503) 2431328-29 Fax: (00503) 2433159 Email: service@coexport.com Email: info@coexport.com Web: http://www.coexport.com Banco Central de Reserva de el Salvador Centro de Trámites de Exp.(CENTREX) Alameda Juan Pablo II y entre 15 y 17 Avenida Norte 06106 SAN SALVADOR Tel : (00503) 2818088-90 Fax : (00503) 2818086 Email: info@elsalvadortrade.com.sv Email: comunicaciones@bcr.gob.sv URL: http://www.elsalvadortrade.com.sv Ministry of Public Health and Social Assistance Calle Arce No. 827 San Salvador, El Salvador Web: http://www.salud.gob.sv/ Regional Customs Integration, Central America Economic Integration System (SIECA): http://www.sieca.int National Science and Technology Council (CONACYT): http://www.conacyt.gob.sv

Ministry of Economy: http://www.minec.gob.sv Customs Authority: http://www.mh.gob.sv/portal/page/portal/PMH/Institucion/Adu ana

Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 22 of 23


El Salvador Official Journal Distributors Association

El Salvador Official Journal: http://www.imprentanacional.gob.sv Distributors Association: www.ades.org.sv

Market Guide for Exporting Goods from Trinidad and Tobago to El Salvador

Page 23 of 23


Appendices


Appendix I – Minimum Wages With effect from 01-01-2014 to 31-12-2014  Approved revision date: 01-01-2015  Information last updated on this page: 06-03-2014  The minimum wage rates in the table are in $ (US Dollar) Industry

Minimum Wage per Day

Textiles and Clothing

6.76

Industry

7.90

Commerce and Services

8.08

Agriculture

3.79

Coffee Harvest Collection

4.13

Sugar Harvest Collection

3.50

Cotton Harvest Collection

3.16

Benefits of Coffee

5.48

Benefits of Cotton and Sugar

3.98

Minimum Wage per Month 202.80 Hours per week specified: 44 237.00 Hours per week specified: 44 242.40 Hours per week specified: 44 113.70 Hours per week specified: 44 123.90 Hours per week specified: 44 105.00 Hours per week specified: 44 94.80 Hours per week specified: 44 164.40 Hours per week specified: 44 119.40 Hours per week specified: 44

Source; Decretos 103, 104, 105 y 106. Diario Official N° 119 tomo 400 Del 01/07/13

Notes/Footnote 1. There is no single national minimum wage, but that is different depending on the sector of the economy. The base salary is lower in the agriculture sector, while the highest is in the trade and services sector. 2. In late June 2013, the National Minimum Wage (MNHA) approved a 12% increase in the legal minimum wage for all sectors to be implemented in three tranches, over a period of 18 months. 3. The agreement, signed by order of the President, determines an increase of 4% from 1 July 2013, on 1 January 2014 another 4%, and the remaining 4% on 1 January 2015. 4. Work hours per week is 44 hours.


Appendix II – Public Translators (Approved by the Ministry of Foreign Affairs, Trinidad and Tobago) 1)

Mr. Kelvin Hoskins #3 O’Connor Street, off Dickson Avenue, Diego Martin Tel: 352-2238/632-8286

2)

Ms. Doris Millan #42 Saddle Road, Maraval Tel: 753-0643/628-8414

Spanish

3)

Mr. Jaime Graells #28 Old Paddock Road, Blue Range, Diego Martin Tel: 759-5218/637-7140

4)

Mr. Luis Arreaza # 38 Carlos Street, Woodbrook Tel: 764-8683

Spanish, French

5)

Mr. Chantale Leonard-St. Clair Director (Ag.) Translation & Interpreting Services Unit Spanish, French, Portuguese, College of Science Technology and Applied Arts Dutch, German of Trinidad and Tobago (COSTAAT) Tel: (868) 625 5030 Ext. 5270 Fax: (868) 627 5714 E-mail: cstclair@costaatt.edu.tt; pwilliams@costaatt.edu.tt

6)

Mr. David Coutisson Director THE ALLIANCE FRANÇAISE # 17 Alcazar Street, Port of Spain Tel: 622-6119/6728

7)

French

Eric Maitrejean CITB Coordinator Caribbean Interpretation & Translation Bureau University of the West Indies St. Augustine Campus, St. Augustine Tel: 662-0758 Email: CITB@sta.uwi.edu

Spanish, French, Arabic


WORKS CITED BBC. (2014). El Salvador Profile. BBC http://www.bbc.com/news/world-latin-america-19401932 i

ii

News.

Retrieved

from

The Central Intelligence Agency (CIA) Factbook. (2014). El Salvador. Retrieved from

https://www.cia.gov/library/publications/the-world-factbook/geos/vc.html EU Trade Directorate. (2014). European Union, Trade in goods with El Salvador. Retrieved from http://trade.ec.europa.eu/doclib/docs/2006/september/tradoc_113379.pdf iii

The World Bank Group. (2014). Ease of Doing Business in Guatemala. Retrieved from http://www.doingbusiness.org/data/exploreeconomies/el-salvador/ iv

GISTnet.com. (2014). El Salvador: Import http://www.gistnet.com/cidb-sample/do-vc.import.html v

(General).

Retrieved

from

StartInBusiness. (2014). What is the best way of setting up? Retrieved from http://www.startinbusiness.co.uk/interbiz/elsalv.htm vi

ABBC – Azevedo Neves Benjamin Mendes Bessa et. al (2008). Getting The Deal Through: Patents in 37 Jurisdictions Worldwide. Romeria Pineda and Associados. Retrieved from http://romeropineda.files.wordpress.com/2012/07/20080314-el-salvador.pdf vii

International Trade Administration. (2012). Market Reports/Tariffs. Office of Textiles and Apparel. Retrieved from http://web.ita.doc.gov/tacgi/OverSeasNew.nsf/alldata/El%20Salvador viii

-000-

El Salvador Market Guide  
El Salvador Market Guide  

Do you understand the Market in El Salvador?

Advertisement