Nestl, the largest food company in the world is a Swissmultinationalfood and drink processing conglomerate corporation headquartered inSwitzerland. Nestl's products includebaby food,medical food, bottled water, breakfast cereals, coffee and tea, confectionery, dairy products, ice cream, frozen food, pet foods, and snacks with 403 factoriesin 84 countries across Europe, Middle East, North Africa and Asia including India. One of the new export destinations that the company wants to explore includes Latin American and ASEAN markets.

Q1. Towards the process of this expansion into a new destination, company faces following issues as listed below. Help the company strategize these pertinent issues with suitable ONE LINER RATIONALE based on application of WTO principles and commitments.

Situation

Your Remarks

1- Company manufactures confectionery at two different locations: India and Middle East. Procurement towards expanding in LAC should be done from which unit and why?

ii.Can Nestle products manufactured in African units enter Latin America at relaxed rate of duty despite absence of trade agreements? If yes how?

iii.Nestle wants to target LAC countries. Will the import duty across MERCOSUR countries be same? Will import duty across all products be same in Brazil, one of the Mercosur countries?

iv.Nestle India faced export detentions for its coffee at Argentinian port due to the presence of ochratoxinswhile local coffee manufacturing companies in Peru where using same levels of ochratoxins. Should Nestle recall its coffee consignment?

v.While exporting goods made in India to Chile and Peru, the company normally used South Pacific Ocean. Which agreement signed amongst these Latin American countries can help the company save its logistics cost to reach the same destinations.

vi.Argentina was the most preferred market within LAC for Nestle-India. Will the opportunity to enter Argentina under Indo-Argentina and Indo-Mercosur trade agreement be same or different and why?

vii.Nestle parallelly wanted to explore ASEAN markets. Confectionery made in Nestle-India and Nestle- China with same HS code 191101 when supplied from Indian manufacturing unit faced a high tariff rate of 65% while Chinese made goods with same HS code availed 0% duty despite the existence of India-ASEAN and China-ASEAN FTA. How was this possible?

viii.More overconfectionerycompanies in China while supplying to Thailand within ASEAN, had to hurry up to avail 0% duty rate. Why did this happen?

ix.To combat Chinese competition, Nestle India wanted to explore opportunities to open sales office abroad. With which country should it explore this opportunity between India-Singapore CECA and Indo-Thailand FTA. Why?

x.Nestle while setting up its manufacturing unit in Thailand faced immigration issues while bringing in labours from Cambodia. However, Thai companies had labours from all over ASEAN.Was it justified?