The trade agreement signed by the Ecuadorian government with China last May continues its internal approval process amid concern from organizations that see “serious threats” and business optimism over the “benefits” it will bring to Ecuadorian manufacturing.

After the constitutional procedure, the trade agreement was published in the Official Register on August 28 and is now waiting for citizens to contest or defend its partial or complete constitutionality, and the deadline for this is the ten-day period that began to run after publication, before it is then confirmed by the National Assembly , as determined by the Constitutional Court (US), and then the agreement would be ratified by the President of the Republic.

The trade agreement with China has already been published in the Official Register so that “every citizen can intervene defending or challenging its partial or complete constitutionality”

For this Monday, September 11, Acción Ecológica is scheduled to present a technical basis based on the readings carried out by the organizations, since they indicate that the ten-day period will expire on this day. They believe that “there are serious threats, conditions are being created for the violation of human rights, nature, groups”. Chapters on investments, economic cooperation, as well as the application of contracts are of concern.

On the other hand, the Ecuadorian Business Committee (CEE) found no unconstitutional defects in its review of the trade agreement. “It is an agreement that has some chapters that benefit Ecuador and that will bring benefits to citizens, traders and development. We are still analyzing whether this warrants submission of a amicus curiae, which is a statement against the ideas currently being analyzed by CC,” says Executive Director, Gabriela Uquillas.

Points of concern

According to Cecilia Chérrez, from Acción Ecológica, they are concerned about the format of the free trade agreement, which – she says – prioritizes the growth of trade and “providing excessive legal guarantees for investment”, as the aim is to create an environment conducive to growth, expansion of trade and success investment in this case China.

“Creating this favorable environment means several things, some regulatory changes that have already been indicated by the Court in its opinion. The CC recognizes that various types of regulations are amended, repealed or created to guarantee the fulfillment of contracts. Therefore, we wonder if all this dynamic of regulatory reform, which already implies the loss of sovereignty over the possibility of establishing one’s own regulations internally, will mean a serious violation of human, collective and ecological rights to nature?

Chérrez, who is also part of the network Ecuador Decide Better without FTA, points out that what was discovered makes them “come to the conclusion that Ecuador will become more and more dependent on the geopolitics that China creates in order to have the natural resources they need.” “: minerals, hydrocarbons, timber, fishing resources, shrimp and other products.”

The trade agreement foresees a gradual reduction of tariffs on Chinese cars until 2038, imported furniture will not be reduced

It holds that the expansion of this type of extractive or production operations is clearly carried out in areas that are often sensitive natural spaces, even in areas that are within areas with a certain level of protection. Furthermore, these are the living spaces of peasant, autochthonous and Afro communities. “All of this will have an impact on those realities.”

He also points out that they are worried that “these are totally asymmetric negotiations”, because in his opinion the reality of Ecuador is one, and that of China is “absolutely different”. It is mentioned that China is one of the main debt creditors. And remember that an investment protection treaty has been in place since 1997 that already provides certain rules of legal protection to Chinese companies and “with this treaty, those protections have been strengthened and are increasingly a straitjacket for national regulations.”

The second chapter they object to is the one on economic cooperation, which refers to fisheries. He says that the contract “includes the possibility of operating factory ships” and that “they work much more with impunity”, which makes them consider “that the same fishing fleet that sometimes stays for a long time will process the products that “come from the extraction of marine species and that will put these products on the Ecuadorian market.”

Optimism in businessmen

On the other hand, the CEE director is optimistic about the trade agreement because it will give Ecuadorian products greater opportunities at the international level. “To the extent that our products have more space, more markets and better conditions, Ecuadorian products that are of the highest level can more easily enter those markets and our trade can increase. Let’s remember that we always promote the issue of a positive trade balance, and we achieve this through greater exports.”

Uquillas indicates that CEE believes that the trade agreement with China was worked on in a “very meticulous” manner and that the private sector was listened to a lot. Furthermore, the sensitivity of the manufacturing sector was recognized, which is why they believe that there are “a number of exclusions that are generally positive”.

“In the history of Ecuador, there is no trade agreement that was rejected by the Assembly. We hope for the same with the agreement with China’

In this sense, he comments that in the revision of the trade agreement that they did, they did not find flaws of unconstitutionality: “We believe that it is an agreement that has some chapters that are beneficial for Ecuador and that will bring benefits to citizens, traders and development.”

While Chérrez points out that it was “a contract negotiated behind closed doors, discussed only with the Ecuadorian Business Committee and without the possibility of accessing information to initiate a public debate.”

As for the concerns of the organizations, the executive director of the business union points out that every point of view is valid and subject to analysis; However, he believes that the process must always be studied from its general perspective. “If we see that Ecuador has excellent production, what it needs more than anything is markets, and if we want to have more markets in the world, trade agreements are the way,” he reiterates.

Likewise, it indicates that CEE “firmly” believes that any company investing in Ecuador must comply with all regulations. He says that to the extent that investment from a country with great economic potential can come to Ecuador, it is “undoubtedly beneficial” because it will generate resources, jobs, etc., but always “according to the rules of the game, we believe in equality of conditions.”

Cell phones, bicycles and electric motorcycles are among the Chinese products that will have a 0 percent tariff

Although the Constitutional Court has already given an opinion on the trade agreement: it found that legislative approval was required and ordered the publication of the full text of the agreement in the Official Register so that any citizen could intervene defending or contesting its constitutionality, Chérrez points out They state that they hope the Court will take take into account “the respect, principles, guarantees that the Constitution has and therefore have an opinion that includes” the concerns they express, because this would be the basis on which the National Assembly would probably later have to make a decision to publish and speak in relation to this contract.

Uquillas emphasizes that it is a trade preferences agreement, so it does not have a dispute settlement variable. “There are sectors that see concerns and it is normal that in any trade agreement concerns are created for national production, but we understand that measures have been taken with greater security so that the production sectors can continue to work,” he points out.

On the other hand, it is considered very important that the Government works on the competitiveness agenda for the production sectors, in the time that has been determined for each of the products that can enter from China with tax exemption. It remains a very important mission of the state, which is to work on the competitiveness agenda so that our production is in optimal conditions.