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Exports to Costa Rica recovered before the beginning of the negotiations of the commercial agreement with Ecuador

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After a year -2021- in which Ecuadorian non-oil exports to Costa Rica fell 32.1% by generating $21.2 million, $10 million less than in 2020, so far in 2022 shipments to that destination, with which Ecuador began this August 8 the first round of negotiations for a trade agreement, show recovery.

According to figures from the Central Bank of Ecuador (BCE), in the first half of this year – from January to May – non-oil exports, with an amount of $11.2 million, grew by $2.9 million compared to the same period of 2021, the year in which it was the fifteenth destination of Ecuadorian non-oil exports to Latin America and the Caribbean, and of agricultural and fishing exports.

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Negotiations of an FTA between Costa Rica and Ecuador begin

The main export products were canned fish; metal manufactures; fish; banana; chemical and pharmaceutical products; livestock products; paper and cardboard manufactures; vehicles and parts; textile fiber manufactures; and, tuna. From January to February 2022, the base of the National Customs Service of Ecuador (Senae) registered 38 Ecuadorian companies exporting non-oil products whose final destination is Costa Rica.

Regarding imports from Costa Rica, a growth trend has been maintained.

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In 2021 they closed with a balance of $58.7 million with a growth of 45.3% compared to 2020, that is, $18.3 million more. While from January to last May they grew by 41.4%, registering an amount of $31.0 million, $9.1 million more compared to 2021.

Among the main products imported from Costa Rica are medicines; metal waste and scrap; tires; insecticides; disinfectants and similar products; switches, other connectors and their parts; fresh plants; medical instruments and apparatus; food preparations; metal manufactures; orthopedic articles and appliances, girdles and bandages.

Meanwhile, the commercial negotiations between the teams of both nations are taking place in a virtual format and will last throughout this week.

This first round takes place after the announcement by presidents Guillermo Lasso and Rodrigo Chaves, on June 9, in the framework of the IX Summit of the Americas, under the will of both countries to begin negotiations.

Costa Rica and Ecuador will negotiate a Free Trade Agreement

It is a state-of-the-art agreement in which 18 disciplines will be negotiated: access to markets for goods; rules of origin and customs procedures; trade facilitation; technical barriers to trade and regulatory consistency; sanitary and phytosanitary measures; commercial defense; competition policy; service trade; electronic commerce; temporary entry of business persons; intellectual property; public procurement; trade and gender inclusion; trade and labor issues; trade and environment; strengthening of commercial capacities for MSMEs, among others.

Before the process, a feasibility study was carried out in 2017, thanks to which Ecuador and Costa Rica evaluated the possibility of negotiating a trade agreement. In April 2019, the Foreign Trade Committee approved the start of negotiations between the parties and the general framework of the negotiation was agreed upon, including this country as a priority on its trade agenda, and between 2021 and 2022 the meetings of chief negotiators were resumed. and coordinators of the agreement, with the aim of modernizing the general framework of the negotiation and strengthening the bilateral relationship.

Foreign direct investment

During the last six years, the average foreign direct investment (FDI) in Ecuador from Costa Rica reached an amount of $26.1 million; 2021 being the year with the highest flow with $85.1 million, according to figures revealed by the Ministry of Production, Foreign Trade, Investments and Fisheries.

In the first quarter of 2022, FDI from Costa Rica was $6 million, which corresponds mainly to the manufacturing industry sector with $83.8 million, which represents 98.6% of the total FDI from the Costa Rican country. In second place is the construction sector; followed by transport, storage and telecommunications and finally communal, social and personal services.

Source: Eluniverso

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