Technical cooperation to promote Colombian palm oil

In the representative office of the Andean Development Corporation (CAF) in Bogota, Enrique Garcia, CAF president & CEO, and Jens Mesa Dishington, president & CEO of Fedepalma, signed a non-reimbursable technical cooperation agreement destined to define and implement measures to improve the logistics chain of supply and distribution for palm oil and its inputs in Colombia.

During the signing, Garcia said that "the study is part of the Competitiveness Support Program (PAC) promoted by CAF for the last five years with the objective of defining a national and regional agenda to strengthen competitiveness in Andean countries, increase economic growth rates and raise the standard of living of the population."

The Logistics and Competitiveness project (LyC), implemented jointly by CAF and the Valencia Polytechnic University in 2002, produced an overall view of the logistics situation in Andean countries. The study analyzed intra- and extra-regional trade flows, economic activity of cargo transport, the legal framework, and state of the existing infrastructure. The conclusions of the project led to a series of actions, including improvement of the logistics chain of certain clusters as an example for improvements in competitiveness through the optimization of the logistics chain.

In Colombia the palm oil cluster was selected for research because of its sectoral conditions, its important role in national exports, the chain’s commitment to co-financing the project, prospects for attracting investment into the sector, and conditions for its role as a catalyst to solve the chronic situation of insecurity and violence in the cultivable areas.

Colombia is the leading producer of palm oil in Latin America and the fourth in the world. In the 40 years of palm cultivation in the country, the area under production has multiplied by 8.3 to over 150,000 hectares. Palm oil cultivation takes place in four large areas (North: Magdalena, North Cesar, Atlántico and Guajira; Central: Santander, Norte de Santander, South Cesar and Bolívar; East: Meta, Cundinamarca, Casanare and Caquetá; and the Western area with Nariño).

Given the importance of palm oil for the Colombian economy, the agreement signed today grants funds to carry out an exhaustive analysis of the logistics chain of the palm oil cluster; organize the internal transport of the oil from the producers to the industries for integration into their production processes; analyze the loading and unloading systems to optimize their logistics; review transport from the production areas to the borders; and analyze and evaluate proposals for use of multimodal transport systems.