Comparative and Competitive Advantages of Tilapia Culture in Selected Asian
Countries
By Ferdinand J. Paraguas and Madan Mohan Dey
ABSTRACT
Tilapia are freshwater fish that originated in Africa, but its production is dominated by Asian countries. International trade of the commodity is limited but increasing exponentially. The Asian countries are the major exporters to the United States. This paper examines the degree of
comparative and competitive advantages of four major tilapia producing Asian countries (i.e., China, Indonesia, Philippines and Thailand) in producing and exporting tilapia to the USA. The Domestic Resource Cost (DRC) method is used to measure the comparative and competitive advantages of these countries at the farm gate level. In view of the availability of the genetically improved farmed tilapia (GIFT) strain in these region and the unstable fluctuation of the exchange rate brought about recently by Asian financial crisis, three types of sensitivity analyses are undertaken to determine the sustainability of competitiveness of these countries. This study determines the changes in the level of comparative and competitive advantage of these countries due to the (1) adoption of GIFT technology (e.g. increase in yield levels); (2) changes in exchange rates; (3) changes in border prices. Results shows that among these Asian countries, the Philippines have the least competitive advantage in exporting tilapia to the USA. With the adoption of the improved strain, the competitiveness of all these countries for tilapia export will increase substantially. Lastly, country-specific policy and government interventions for sustaining
competitive advantage are discussed.
KEYWORDS: Comparative and competitive advantage, domestic resource cost, tilapia, Asia, GIFT technology
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