After three years of negotiations, the Unified Free Trade Agreement between Mexico and Central America was signed on November 22nd 2011.
The treaty unifies standards in areas such as trade in goods, investment, services, intellectual property and resolution of disputes, for El Salvador, Guatemala, Costa Rica, Nicaragua and Honduras in their trade relations with Mexico.
In an article in Laprensa.com.ni, the Mexican ambassador to Nicaragua, Raul Lopez Lira, writes about the opportunities that the unified TLC presents for Central American companies.
"A vigorous commercial area has been created that represents a potential market of 150 million people and the establishment of conditions for creating more and better export opportunities, particularly for small and medium enterprises.
It also incorporates the tariff elimination commitments of the original agreements, so that by the end of 2012 most goods will be exempt; a trade facilitation chapter has been negotiated to eliminate non-tariff barriers; most rules of origin have been validated, enabling the possibility of incorporating raw materials from third party countries to produce goods which can be considered from the producing country.
For the first time, Central American countries can access the Regional Integration Committee of Supplies, to supply raw materials in the production of Mexican goods, mainly textiles. In addition, Central America gained tariff benefits for textiles, paper, windows, automobiles, cigarettes, freezers, electric conductors, tuna, corn and edible oils. "
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A press release from the Costa Rican Ministry of Foreign Trade announced that, “On October 20, 2011, in the city of San Salvador, technical negotiations for the Free Trade Agreement between Mexico and Central America were finalized.”
The Mexican Senate has unanimously approved a Free Trade Agreement (FTA) with Central America.
The treaty provides a common legal framework for the conduct of trade in goods and services between the parties, as well as the establishment of investment in the region.
"The trade agreement signed on 22 November in El Salvador, states that in 2012 tariff elimination commitments must be adhered to and most of Mexico's trade with these countries will be free of taxes", reported EFE.
Yesterday the second round of negotiations began to unify the various agreements Central American countries have signed with Mexico.
The objective is to unify the different agreements signed by Nicaragua, Costa Rica and the "Northern Triangle" (Guatemala, Honduras and El Salvador) into one single Free Trade Agreement (FTA).
Until now Mexico has had a separate bilateral treaty with Costa Rica, Nicaragua and the Northern Triangle consisting of El Salvador, Guatemala and Honduras.
The Unified Free Trade Agreement (FTA) will be signed today, November 22 in San Salvador, said El Salvador’s finance minister.