Raising taxes exclusively on Colombian products is one of the measures that Panama could take until Colombia starts to comply with the WTO ruling.
The Panamanian government has asked the World Trade Organization (WTO) for authorization to use trade measures against Colombia, worth $210 million, equivalent to the effects that the imposition of Colombian tariffs had on the Colon Free Zone.
This is good news for Central American textile manufacturers. We will have to wait and see what other protectionist measures will be implemented by President Trump.
The possibility that the United States buys textiles from Vietnam at lower prices than those paid by textile manufacturers in Central America seems to have now disappeared, however, in order to measure the true impact of the Trump protectionist policy on trade between US business and the region we will have to wait to see what other decisions on international trade deals are take by the new administration.
Employers indicate that taking the dispute to an arbitration panel will cost many millions of dollars and will result in indemnization payments, as it is clear that trade agreements and phytosanitary standards were breached.
The announcement by the Mexican authorities to take Costa Rica to a World Trade Organization (WTO) arbitration panel because of the dispute over avocados, has caused concern among employers who are members of the Chamber of Exporters and Importers of Perishable Goods (Ceipp).
The coffee union has stated that the advance payment of withholding tax reduces the trade margin of exporters by up to 40%.
The obligation to pay an advance withholding tax (IR) to the DGI is threatening the competitiveness of coffee growers, especially companies whose profit is on commission on sales that are placed on the international market. The complaint was made by Michael Healy, president of the Union of Agricultural Producers of Nicaragua to Trincheraonline.com.
Free Zone users require another type of measures on top of the proposals the government has discussed in the Assembly, such as reducing the charges for renting.
The bill that was discussed in Congress and which seeks to increase the competitiveness of the Colon Free Zone (CFZ), (already approved in the first debate) is not enough for entrepreneurs. Marco Tellez, president of the Association of Users (AU), told Prensa.com that "... users recognize the efforts of the Government in the proposal already presented, but they are not enough. We do not want companies to make money, we want to stay. "
They argue that joining the bloc offers growth potential for commercial partners who to date represent only 4% of total exports.
Enrique Egloff, president of the Chamber of Industries of Costa Rica provided support for this with figures which show that in 2015 Costa Rica's exports to the countries in the Pacific Alliance totaled $377 million and imports $1.786 billion. These amounts accounted for 4% of total exports and 12% of total imports. Of those exports, 97% are industrial goods, and for imports 95% are.
The irreconcilable positions of both countries over phytosanitary measures for the Mexican product form the backdrop to a possible arbitration panel with the world trade body.
Since Costa Rica stopped issuing permits for the entry of Hass avocados from Mexico, for phytosanitary protectionism reasons, (the country argues they are protecting themselves from the disease known as sunspot), neither country has managed to convince the other through technical and political methods to reopen the market.
Businessmen have complained to the Executive office about the slowness and inefficiency of customs inspections of the country, where containers are retained for up to 15 days.
The truckers blockade which paralyzed customs offices in Jutiapa for a week, has made entrepreneurs question the efficiency of border posts in the country because of the time invested in land transport. They claim the process is slow and makes products more expensive as well as harming the competitiveness of the country.
Guatemala carriers have blocked passage through customs posts at Pedro de Alvarado, Jutiapa, in protest against the excessive slowness of procedures for entering El Salvador.
The slowness of customs formalities as a result of the computer system crash caused some 300 carriers to form a blockade using their trucks from Sunday February 28th on the route to the customs office in Ciudad Pedro de Alvarado, located in Moyuta, in the Guatemalan department of Jutiapa, on the border with El Salvador.
While authorities have reactivated the process for binational customs liberalization, entrepreneurs have pointed to constraints on issues related to bureaucracy, corruption, and infrastructure at border crossing points.
The governments of Guatemala and El Salvador have resumed work in Technical Groups to liberalize binational border posts. In a statement, they reported that dialogue has been revived over customs, sanitary and phytosanitary issues, migration, security, and legal and tax issues.
Ranchers are complaining that the increase of $0.20 per kilogram of cattle exported as leather is eroding their competitiveness.
The DGI published in La Gaceta on 4 February that "... In every act of exporting live cattle made by natural persons, it will be mandatory to submit to the Center for Exports (CETREX ) and the Directorate General of Customs Services the taxable receipt in original format which supports retention payments for its verification. "
The country has been criticized for violating trade agreements and placing phytosanitary barriers on trade using political-ideological and non-technical justifications.
Having entrusted the management of the Ministries of Economy and Commerce and Agriculture and Livestock -and linked institutions - to a group of officials who believe in their own last century protectionist model - and going against openness to the world practiced by the country in the last 20 years, and who were also openly opposing the Central American Free trade Agreement (CAFTA) with the United States, the Solis administration has made sure that there will be recurrent conflicts related in trade of agro-industrial products to the Northern nation, Costa Rica's main trading partner.
Lala Group intends to take advantage of the free transit of goods in Central America to produce and export milk from Nicaragua to the entire region.
The Mexican company Lala confirmed the positive performance of Nicaragua's economy, announcing its intention to turn the country into a production hub and to export dairy products to the rest of Central America.
ATS El Salvador is a Customs Agency with 26 years of providing services for imports, exports, transits, consultancies and international transport.
Operates in El Salvador
Phone: (503) 2235 6522 - (503) 2235 6524