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The currency exchange control policy has encouraged non traditional exports. Industries have decided to expand their markets towards Colombia, the United States, Argentina Brazil, and Europe.

Francisco Mendoza, president of the Venezuelan Exporters Association (AVEX), informed that sales from the national companies to the international markets, have increased 30%, and expectations are to have billed 2.8billion U$ by the end of the year.

The main exporting sectors are aluminum, the iron and steel industry, food, metal mechanics, vehicle parts, crafts, and technology.

Mendoza commented that one of the difficulties they had had was the delay in the draw back payments by the National Service of Tax and Customs Administration (Seniat). Nevertheless, the institution has regularized its payments: it issued special import tax reimbursement certificates for 190 billion bolívares (Bs.).

The president of AVEX, indicated that Seniat still has a debt of 500 billion Bs., for devolution of sales tax (IVA), which the exporters pay when they purchase inputs abroad for the production of exportable goods.

However, the National Institute of Statistics reports that until the first semester of this year, sales of Venezuelan manufactured products abroad surpassed 3.6 billion U$, including 1.6 billion U$ to the U.S., 446 million to Colombia, and 180 million to Mexico.

Optimistic neighbors

The 11.9% recovery of the Venezuelan GNP, has encouraged Colombian businessmen who hope their sales to the local market will increase.

A report by the Venezuelan-Colombian Chamber of Commerce, -that has now shunned away from coupmonger militancy -forecasts a rise of our neighbors exports towards our country by 81%, for a total 1.26 billion U$, with the help of the devaluation of our currency.

They expect to increase clothing and textile industry sales by 74% (a 160 million U$ total), agro-industry by 70%, and a total of 40 million U$ in basic industry and siderurgy.

According to the plans in the Ministry of Production and Trade, commerce with Argentina is expected to surpass the billion U$ mark by the end of 2004,. With Venezuela’s entrance in Mercosur (South American common market), the government expects national exports to reach 3 billion U$, a 328.5% increase, compared to the current 700 million.

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Paper policies

The economic programs that the government has set forth throughout the last five years, contained several proposals meant to encourage non traditional exports.

Mendoza recalled the proposal to establish duty free areas. This measure would encourage, through fiscal incentives, the industries to develop their activities(and thus promote exports). Nevertheless, he said that this measure has not yet been made effective.

The last national plan for the development of non traditional exports, presented this year by the Ministry of Production and Commerce, established the creation of a National Exportation Council, in charge of elaborating the country’s commercial policies.

This council would be directed by the head of state and formed by the ministers of Production and Commerce(as coordinator), Agriculture and Lands; Finance, Foreign Affairs, Infrastructure, as well as the maximum authorities of the Seniat, the Commission for Currency Administration (Cadivi), the Bank of External Commerce (Bancoex), and the Bank for Social and Economic Development (Bandes). The direct participation of the private sector in this projected council has not been considered.

The Exportation Council would pursue the following goals.

- To propose public policies related to external trade, and production and export of goods and services.

- To set forth plans to encourage foreign investments.

- To advise the national government on foreign policy, internationalagreements, participation in regional integration initiatives, and its relations with international organizations.

- To make proposals and coordinate activities to promote non traditional Venezuelan exports.

- To assess and advise exporting firms on their needs; with special attention to matters concerning legal requirements for exportation and for the importation of inputs.

- To draw up the set of export regulations.