Ecuadorian Rose Industry
1. What is the basis of Ecuador’s comparative advantage in the production of roses? Ecuador’s rose farms are located in the just about perfect position for growing long and straight roses or at least most of the farms. They are positioned at about 10,000 feet elevation in the Andes Mountains. This provides the roses with high altitude, volcanic soil that is very rich in ingredients, and located on the equator. This gives the roses about 12 hours of daylight every day. Graham) This provides an intense amount of sunlight, so farmers use plastic sheeting to create a greenhouse effect. I believe this helps keep the roses from burning up, being so close to the sun, and from freezing on the cold nights. (Hamilton) It creates a sense of perfect temperatures. (Thompson) 2. Most Ecuadorean roses are sold in the United States or Europe. Who in these countries benefit from the importation of Ecuadorean roses, and how do they benefit? Who loses? Do you think the benefits outweigh the costs?
In 2006, the United States accounted for 61% of the Ecuadorean roses’ total sales. This made us the largest market in this rose industry. Europe accounted for 20% of the exports of Ecuadorean flowers, while these flowers accounted for 31% of the United States flower imports. (Alvaro) Both countries benefit overall because they can import the roses at such a low price and most of the profits stay in the importing country. (Graham) I believe local growers are the ones who lose in this situation. If buyers can find them for a lower price, most will take it so they can keep more profits.
This isn’t necessarily the best option for our country, but some companies do not care about the greater good of helping our own country. 3. How does the rose export industry benefit Ecuador? Do these benefits have any implications for the United States and Europe? With the increase of rose and other flower exportation from Ecuador, the country’s export revenue has increased and is increasing the stability of its economy. (Halberstadt) This is one of the effects of the fair trade agreement between them and the United States. Another effect is the extra money the people are getting.
They are able to take classes to learn how to manage the extra money. (Hamilton) Ecuador has also been able to pave more roads, build sophisticated irrigation systems, and some schools with the taxes and revenues from growing roses. (Thompson) Developed countries, like the United States and Europe, have to understand that as developing nations, like Ecuador, become more developed they have to adhere to global standards and it is up to developed countries to help with this. 4. How should developed nations respond to reports of poor working conditions in this industry?
Should importers in some way certify Ecuadorean producers, or only importing from those who adhere to strict labor and environmental standards? I believe the developed nations should help to encourage making the working conditions better. Although the average flower worker does earn more than the minimum wage of $120 per month, it does not make up for the horrible conditions. I also believe importers should certify Ecuadorean producers for those following the labor and environmental standards and those who are trying to improve their operations. Plantations, like RosaPrima, have done this.
Ross Johnson, a general manager of the plantation, said that they had made a lot of improvements over the years, from protective wear and equipment to cracking down of child labor. (Thompson)
References:
- Alvaro, Mercedes. “Ecuador Flower Exports Require U. S. Trade Deal to Keep Growing. ” Dow Jones Newswires Feb. 2006. 3 March 2013 <http://www. organicbouquet.com/i_205/20060215-DowJones. html>.
- Graham, Grace. “Five Reasons who you shouldn’t Buy her Roses” North by Northwestern Feb. 2010.3 March 2013 < http://northbynorthwestern. om/story/five-more-reasons-why-you-didnt-buy-your-girlfrien/>.
- Halberstadt, Jason. “Ecuador Foreign Trade. ” Ecuador Trade Copyright 1997-2013. 3 March 2013 <http://ecuadorexplorer. com/html/trade. html>
- Hamilton, Cortney and Deb Tullmann. “Rough Cut. ” Ecuador Flower Power Feb. 2008. 3 March 2013 <http://www. pbs.org/frontlineworld/rough/2008/02/ecuador_a_rosie. html>.
- Thompson, Ginger. “Behind Roses’ Beauty, Poor and Ill Workers” NY Times Feb, 2003. 3 March 2013 <http://www. nytimes. com/2003/02/13/us/behind-roses-beauty-poor-and-ill-workers. html? pagewanted=all&src=pm>.
