Ecuador’s Parliament approves trade agreement with Costa Rica

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By LatAm Reports Editorial Team

The National Assembly (Parliament) of Ecuador unanimously approved on Tuesday the trade agreement signed with Costa Rica, qualified as last generation and which was signed between the two governments in San José in March last year.

The approval of the agreement was achieved with the unanimous vote of the 118 legislators who were present at the session of the plenary of the Assembly to discuss the trade instrument estimated to increase the volume of bilateral exchange by 10%.

The treaty was signed on March 1, 2023 in San José between the president of Costa Rica, the Social Democrat Rodrigo Chaves, and the then president of Ecuador, the conservative Guillermo Lasso, who left power at the end of November.

The agreement, which aims to free up more than 90 per cent of the bilateral trade offer, is also necessary for both countries because it seeks its incorporation into the Pacific Alliance, a regional association mechanism that is currently made up of Colombia, Chile, Mexico and Peru.

During Tuesday’s debate in the plenary of the Ecuadorian Assembly, the official legislator Jonathan Parra said that during the negotiation of the trade agreement with Costa Rica it was taken to ensure that the agreement protects and helps small and medium-sized entrepreneurs.

He recalled that, with the agreement, 97% of the Ecuadorian export offer to Costa Rica will enter with tariff preferences and that 84% of that universe will do so without any tariff from the first day that enters into force.

His colleague Raisa Corral, of the Citizen Revolution movement, which has as its leader former President Rafael Correa (2007-2017), observed that this agreement is different from others, as it is a state-of-the-art agreement and represents an evolution of traditional trade agreements.

In addition, he highlighted the economic, social and cultural similarities between the two nations and the opportunity that opens with the agreement – to strengthen the Ecuadorian economy by offering new markets for our products.

According to a report by the Assembly, this trade agreement will improve the competitiveness of canned and preserved fish, metal manufactures, wooden boards, medicines, shrimp (gamba), white line, porcelain and sanitary ceramics, food pastas, leather and textile manufactures, among others.

The agreement also excludes sensitive products such as beef, edible, dairy, pineapple, cassava, sugar, unasled coffee, among others, of which Costa Rica is an important exporter.

With this agreement, Ecuador plans to balance the balance of competitiveness with Costa Rica, since currently 65% of Ecuadorian exports pay tariffs on entry to that market of 5 million consumers; while with the agreement this volume will enter with a zero tariff.

The trade agreement with Costa Rica is in addition to the one ratified by the National Assembly on 7 February with China, while in the process of ratification is the free trade agreement signed with South Korea. 

This article has been translated from the original which first appeared in El Mundo CR