Paralyzed in political terms, the integration of Central American countries continues to advance in commercial terms.
While trade between the Central American countries continues to grow, as well as regional synergy between its companies, governments have been unable in recent years to marry the process of trade integration with the necessary institutional integration.
The region's federation of chambers of commerce (Fecamco in Spanish) encourages governments to keep pushing for customs union.
A Fecamco press release states that in meetings held between October 31st and November 1st discussions centered on Central America's political and economic situation that led to a renewed call to the region's governments to consider important topics.
A dedicated electronic processing desk for exports and imports in El Salvador (CIEX) is now connected to the local customs offices and those of Honduras, Guatemala and Nicaragua.
Costa Rica will be added soon.
Cornelio Deras, director of the Center for Import and Export Procedures (CIEX), noted that the technology they are using allows them to connect to any country with whom they have a free trade agreement or a commercial interest.
The meeting of technical groups from the countries of Central American Integration System (SICA) in El Salvador ended with significant advances
Progress was made in the preparation of some 15 rules of origin and the harmonization of tariffs for different products.
Deputy Minister of Economy of El Salvador, Mario Hernandes, told Reuters, "Decisions made in the technical rounds will be passed up to the technical and deputy ministers of Trade and Economy for approval."
Costa Rican representatives from the production sector agree that lack of infrastructure at border crossings is causing delays.
The dissatisfaction is highest among industry representatives referring to customs in Peñas Blancas, where the trucks are taking between 12 and 36 hours to cross the border.
"Despite complaints, customs has reported a recovery in its revenues during the first half of the year, in comparison with the same periods in 2010 and 2009."
The Association Agreement between the region and the EU will start without having completed the process of a customs union, and without having created a common tariff.
This is what officials declared at the European Union Trade Commission, "there are marked differences between the Central American nations that can not be dissolved by sheer force, because they have come about by historic events."
Transporting a truckload from Guatemala to Costa Rica takes four days, when the journey could be completed in 30 hours.
The Business Committee for Customs Union launched a campaign to accelerate and complete the integration, attacking in particular mental and cultural barriers which persist in economic actors and in the general population.
An article in Prensalibre.com reported that the president of the Business Committee, Adam Aquino, claimed, “Not being able to facilitate trade results in losses and high costs for Central American consumers. The main causes for slow cargo movement between El Salvador and Guatemala, is the different interpretation officials make of the legal instruments approved by the customs union.
The new Customs Law, which includes the Central American Customs Code, would be ready by July 2011.
The project, which is currently at the Parliament's Economics Committee, will also include Central American customs regulations and seek to reorganize the General Customs Department (DGA).
Wálmaro Gutiérrez, deputy chairman of the Committee, said the new legislation seeks to "match" service users with the DGA.
The Central American Chambers of Commerce Federation called to suspend financial aid to SIECA.
In replacing Yolanda Mayora at the direction of the Central American Economic Integration Department (SIECA), FECAMCO issued the following statement:
"After 50 years aiming at regional integration in Central America, recent events in the Central American Economic Integration Department and the actions of the COMIECO Ministers as well as the Presidents of the region have deeply weakened the institutional foundations of our integration, violating legal procedures and, especially, breaking the spirit of integration of the institution which oversees the progress of this historical regional unity.
With the publication in the official newspaper the Framework Convention for the Establishment of the Customs Union is now in effect.
The agreement was approved by Congress on September 9th, 2010.
Deputy Economy Minister for Foreign Trade and Integration, Raul Trejo, told Sigloxxi.com, "We are legally fulfilling a commitment made by all countries in the region” explaining that it has been ratified by almost all nations with a pending process in Costa Rica."
When talking about how well the Latin American economy is doing, there should be a note added: "except Central America and the Caribbean countries."
In the interview to Humberto López, Chief Economist, World Bank (WB) for Central America by Juan Pablo Arias of Nacion.com, he reflects: "Central America in 2010 grew much less than South America and for 2011 it expects a lower growth rate than the south of the continent.
"SIECA is currently under question, ever since the appointment of the Secretary General was made abnormally."
The Federation of Private Entities of CA, Panama and Dominican Republic (FEDEPRICAP), canceled a meeting with the Spanish Organizations Confederation because the meeting was sponsored by the Central American Economic Integration Department (SIECA) as part of a project which manages the Department itself.
With the publication in the official newspaper, Guatemala complies with the legal framework to implement the customs union.
Raul Trejo Esquivel, Deputy Minister of Economy, referring to such ratification, stated "is the legal basis to remove all restrictions on regional trade and strengthens the union process."
Prensalibre.com writes, "this ratification means that if a third country cargo enters one of the ports in Guatemala and is destined for another Central American country, the fees will be paid in the country and the cargo will be free to transit across Central America."
In the process to form a Customs Union, authorities from both countries are analyzing a joint customs office in the Guasaule area.
They would be located in the same territory and share the same administrative offices to receive and dispatch merchandise.
This year, both countries started a customs modernization process which will improve some procedures to control imports, cut red-tape and increase the flow of trade between both countries.
In the context of negotiations on the Central American Customs Union some changes have been agreed that will benefit farmers.
The text of the agreement, which will soon come into force in the countries in the region, certain unnecessary technical requirements have been removed that made the fertilizer register bureaucratic.
"In addition, regulations were incorporated that were needed to prevent soil amendments from being registered as fertilizers. Finally, concepts and parameters were specified to classify low concentration formulas, which do little to improve the region's productivity and are now being sold in various Central American countries," reports La Prensa Libre in its web portal.