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Agroforestry in Ecuador

Hola Everyone,

July 2010

Although my site tends to attract foreigners who are interested in retiring in Ecuador, we notice that there is a growing number of people who are younger (and often with children) who are attracted to living in Ecuador. These people are interested in earning money while they are here, to supplement savings. It seems that the worse the US economy gets, the more interest there is in relocating overseas. Cuenca seems to be attracting lots of interest at the moment. The ranking of Cuenca as the best retirement haven in the world (by International Living and others) is definitely putting a focus on both Ecuador and Cuenca. In 2009 IL also ranked Ecuador as the best retirement country, up from #2 in 2008.

I am writing this article for the benefit of people who wish to come to Ecuador to live, as well as start businesses. We have been here for nearly 2 ½ years now, and have noticed many opportunities that could be picked up by foreigners. Below is a list of ideas to start with. This list is only our ideas, and we are sure that with some brainstorming, the list would grow.

1. Exports

Craft Products: There are many quality hand-made products made in Ecuador. A trip to the Otavalo markets (about 2 hours North of Quito) on a Saturday will show you a huge range of products that could be exported. And there are many other towns throughout Ecuador that specialize in different product ranges – silver & gold jewelry, leather goods, weaving, furniture, wood carvings, musical instruments, fresh flowers, and more.

In early 2008 we started exporting lightweight scarves to Australia. Within two months, we were selling to about 50 retail stores, mostly in our home state in Western Australia. We then appointed a national distributor and returned to Ecuador to live full-time – and try and duplicate the same idea in other countries. This business was going well until the Australian dollar crashed against the US dollar from 0.98 to 0.61 within 3 months – a massive change which meant that our Australian distributor could no longer viably buy our Ecuadorian products.

The exchange rate has climbed back up again, and the Australian economy is running against the trend compared with the US and Europe – it is booming mainly because of the mineral resource sector. So an opportunity to export to Australia again exists. However, it should be balanced with exports to other countries.

This exchange rate risk would not occur if exports were to the USA because the currency is the same. The opportunity to work with local craft people and export as a cooperative still exists. The traditional marketing of these sorts of products in Western Countries is by exhibiting at trade fairs. This could be done on behalf of many craft people. The North American trade fair medium would be an obvious place to start. Less than $30,000 would be required to kick-start this sort of business, especially if suppliers would work with you.

Biofuels and Timber are products that can be grown in various areas of Ecuador, and then sold locally or exported. Ecuador is a very environmentally friendly country. In fact it is the only country in the world that has given legal rights to nature itself. This is written in the country’s new constitution. These activities could be done as part of a reforestation program in the Amazon Basin. Other areas of Ecuador would also be suitable because many trees are tolerant of a large range of soil types and climate. There are both trees and crops that will produce oil which can be made into biofuels. One tree will produce up to 18 tonne per hectare (over 7 gallons per acre) of oil. It is a legume, so it will also improve the soils for crops grown nearby. Other crops can be grown between the trees in an agroforestry context. This is a very popular way of agriculture in China. For example, over 5,000,000 acres of Paulownia trees are grown in China, and most of it is grown in conjunction with other agricultural enterprises. Have a look at http://www.maf.govt.nz/sff/about-projects/search/L03-022/chapter-2.pdf to see such an example. Such a venture would substantially improve the lives of the local Ecuadorian people, as well as provide substantial export revenue.

Agricultural Products: Fresh flowers represents an existing large export market to North America. However, there are still opportunities to export from the growers direct to retail customers, or perhaps direct to the wedding and other business functions market. Some growers offer this as a 4-day door-to-door service. There would be an opportunity for people to address this niche with direct marketing.

Marketing Food Products is another area of possibility. A great example to look is that of promoting the growing and marketing organic Quinoa (pronounced “keen-wa”) from Ecuador. Have a look at www.incaorganics.com as a benchmark. Read about how it all started by a Chicago couple, Bob & Marjorie Leventry. They started with 12 farmers growing Quinoa in 1998, and within five years, there were over 4,000 growers. The remarkable aspect to this story is that malnutrition dropped from 74% to less than 20%, and the average household incomes doubled, simply because the families started to consume the quinoa. The United Nations has called quinoa a “super food” because it contains all of the essential amino acids. It is a “complete protein”. Even NASA has considered it for astronauts on long space flights. The majority of the harvested product is currently exported to the USA, England and Australia.

CLICK HERE FOR QUINOA RECIPE BOOK

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Another success story is the growing and exporting of Guayusa Tea. This venture was initiated by a couple of young American guys. Have a look at www.drinkruna.com. Guayusa could be grown in conjunction with the agroforestry concept mentioned above – because the tea likes to be grown in the shade of trees. This product is also in the process of being exported to the USA and Australia.

Medicinal and Specialist Food Plants can be grown in many areas of Ecuador. These can then be packaged and sold to the domestic market and also exported overseas. Have a look at http://www.florasana.org/ to see what a foreigner has achieved. Also have a look at http://www.ecuabirm.com/ - another health product developed by an Ecuadorian. It is particularly suited for prostate health.

2. Imports –there are also many opportunities to import products into Ecuador. For example:

There is a need for new Environmental Technologies. Examples are organic waste processing technologies (eg home composting systems), waste water recycling systems, biofuel refining, Compressed Natural Gas (CNG) technologies for buses, etc. Exclusive distributorships are possible.

Alternative Road Building Technology is a potential lucrative opportunity for people who are experienced and knowledgeable about machinery. Most of the arterial roads in Ecuador are very poorly maintained. Even in the city suburbs, it is not unusual to drive through wealthy areas on horrible access roads. Several people are looking at this sort of opportunity, but there is a huge need for this sort of service and expertise all over the country. There are opportunities for exclusive distributorships for specialized machinery, chemical inputs, and more.

3. Internet Marketing. For those so inclined, this is an area where the horizon is limitless. I now even make enough from my web site to pay for our living expenses in Ecuador. And this is mostly from Google Adsense. These are advertisements that Google select to put on my web pages. The revenue is totally determined by the volume of traffic to my site. There is a direct relationship between the traffic volume and the income from Adsense. This means that I can concentrate on providing content for my site, without really needing to do any hard sell to my readers. I have purchased some internet coaching programs (less than $200 each) to help me learn how to increase traffic. Below are two examples of programs I have followed and implemented. From this information, I am able to drive even more traffic to my site. In turn, this also leads to more interest in the other areas I am involved in (eg. My tours, property sales, etc). It is great to be able to earn passive income, even while I sleep. And by living in Ecuador, I do not need to earn a fortune to be able to live OK. So it is possible to come here to live, even if you don’t receive a pension.

5. Services

Starting a Realtor Business is always a possibility, even without a license. Many foreigners start this sort of business with a local person so that they can be bilingual “buying agents”. They offer services to foreigners that local realtors cannot usually provide (mainly due to a lack of the English language). However, this market is becoming very competitive. There was only one company offering this service when we first arrived in Cuenca. Now there are about six, including myself. But it is always possible to network with existing realtors on a conjunctional basis. This means that you only need to attract new visitors via your own overseas networks or with internet marketing.

Relocation & Shipping Services for the increasing numbers of foreigners coming to Ecuador is an area still open to more competition. Although there are existing companies in that market, not all offer bilingual services, and some overcharge the “gringo market”. Bringing a container load of goods into the country can be a very expensive experience unless you have expert assistance. With the help of a local who has been in the industry, you could soon gain that experience and knowledge.

Medical Tourism is a growing market. At this stage very little of that market comes to Ecuador. But there is no reason why it shouldn’t. In fact there is a goal by some in the medical field that they want Cuenca to be the “Medical Tourism Capital of South America”. Cuenca has excellent hospitals and excellent doctors. The facilities and equipment are very modern, and the specialist doctors are all trained overseas (Europe, USA, Argentina, etc). Medical costs are generally only 10-15% of those in the USA.

Dental services are also great in Ecuador. Again the prices are much less expensive than in most other countries.

TEcuador is an ideal country to come to for professional medical & dental services, and at the same time enjoy the relaxing and new experience of great climate, hospitable people, and possibly some suitable tourism.

This is a great business opportunity for many people. It is a multi-million dollar market. It has been estimated that over 6,000,000 Americans will travel overseas this year for medical/surgical procedures.

Western standard health retreats are not evident in Ecuador. The ones I mean are like the Ann Wigmore programs (fasting, wheatgrass, etc) and other cancer retreats based on cleansing, fasting, raw foods, etc. There are opportunities to start such programs in Ecuador. Many people from overseas would come to Ecuador to enjoy the lower cost facilities, climate, and more. This could be a great add-on to a Medical Tourism business. People could either come for a pre-operation cleanse (to build immunity) and/or for post-operation recuperation. To begin with existing facilities like Uzhupud could be used.

Starting or buying a restaurant is always open for new entrants. If you have a talent for preparing good food and offer a good service you will attract locals as well as the expat community. A relatively new restaurant in Cuenca (called Kookaburras) is now a favorite hang-out for many expats. This was started by an Australian couple. If you can combine a restaurant with some rooms for rent (like Kookaburras), that is even a better combination.

Starting a natural products store in an area that is close to a larger community of expats also looks like a promising idea. Nearly all the natural products stores are located in the city center, and not in the suburbs. These stores also do not stock many of the products that would normally be available in North America. Therefore, there is an opportunity to stock products that are not generally available in Ecuador. Even a mail-order service could be offered for expats in other areas of Ecuador. These people could be found on the various forums, social networking sites like Facebook, etc.

The above ideas are just a start. If you have a passion or an interest or experience in an area that is not catered for here, then there is an opportunity to fill the gap. We are happy to discuss any ideas with you. This can be on a fee basis.   

Chao for now Dixie

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