The trade agreement will bring one of the most dynamic economies in the world, which has a per capita GDP close to $51,000, closer to the Costa Rican economy.
From a press release by the Ministry of Foreign Trade of Costa Rica (COMEX):
Monday, July 1, will see the entry into force of the Free Trade Agreement (FTA) between Costa Rica and Singapore, which brings the Costa Rican economy closer to one of the largest in the world. With a population similar to that of Costa Rica, Singapore has one of the highest per capita GDPs, around $51,000.
With the approval of the FTA between the two countries, all exportable Costa Rican products will enter Singapore completely duty free.
From a press release issued by the Legislative Assembly of Costa Rica:
From now on domestic products will enter the market in Singapore duty free, after 39 out of 44 members present approved on its second reading the Free Trade Agreement between Costa Rica and this Asian nation.
Both countries confirmed the agreement, after finally finding common ground in the last remaining issue: financial services.
In the last negotiation round, which took place in Costa Rica from January 8th to 15th, both parties accorded all the texts of the treaty. The only issue remaining was a pending proposal related to investment services, which was solved later via phone communication between both Ministers.
By the end of this fifth negotiation round, Costa Rica expects to gain market access for all the goods it requested.
The country wants access to the Singaporean market for agricultural products like coffee, fruits and vegetables, plus some agri-industial goods and prepared foods, explained Fernando Ocampo, chief Costa Rican negotiator.
Fernando Ocampo, chief negotiator for Costa Rica, informed they have consulted with the private sector, and the main concern of the businessmen, and key point in the negotiation, is the definition of rules of origin, as Singapore imports lots of food and other products in order to reprocess them.
The Asian country is conditioning a non triangulation agreement requested by Costa Rica to larger market access for its products.
Costa Rica had initially offered tax free entry for 90% of the products.
"Singapore's interest is to increase sales of condensed milk, some plastics and juice from plants not grown in Costa Rica", reports Nacion.com. "The negotiating team must consult with the private sector".
After the second negotiation round for the Costa Rica - Singapore Free Trade Agreement, a consensus was achieved on rules of origin. This established a general rule under which two things would be considered: firstly, if there is a tariff category change; and secondly, a 35% regional content value.
Progress was made in access to markets and rules of origin, topics of great importance to define the specific goods each side will offer.
The II Negotiation Round for the Free Trade Agreement between Costa Rica and Singapore concluded yesterday, after six days of video conferences. The delegations from both countries made important advances towards a normative text, as their work was based on proposals and reactions exchanged by electronic means in the weeks prior to this round.
For Costa Rican sector leaders, having access to raw materials from all over the world is essential.
Costa Rica's chief negotiator for the Singapore FTA said that the most important topic to deal with is Rules of Origin. In response to this, the president of the Costa Rican Chamber of the Food Industry, Tomás Pozuela, said that "they are a sector in favor of opening markets, but they oppose the restriction of not being able to access international markets in search for raw materials protected by tariff policies".
In the upcoming second round of negotiations, Costa Rica will seek to establish tight rules of origin for Singaporean products.
The idea is to prevent the Asian country from importing raw materials from other countries, processing them and exporting them to Costa Rica with Free Trade benefits, remarked Fernando Ocampo, chief negotiator for Costa Rica.
In the second negotiation round, to be held early September, the first regulation agreements are expected.
Much progress has been done on the regulation texts and the general framework for several chapters, so Costa Rica is expecting to close several of these in the upcoming negotiation round, to be held in Singapore on September the 2nd.
The third round of talks between China and Costa Rica will take place in Liberia, in direct contact with those industries.
From June 15 – 19, a third round of negotiations for the FTA will take place in Liberia, Guanacaste. The setting will be used to show "Chinese entrepreneurs the development of tourism infrastructure and farm production of beef there."