The first countries to enforce this Unified Agreement will be El Salvador, Nicaragua and Mexico and the other countries of the region are still in the process of ratification with the Legislature.
A press release from the Ministry of Economy of El Salvador (Minec) reads:
Starting from September 1 the new unified FTA between Central America and Mexico takes effect, under which the three FTAs that Mexico had to date with Costa Rica, Nicaragua and the Northern Triangle (Guatemala, El Salvador and Honduras), are consolidated into one agreement.
Nicaraguan products such as leather, footwear, yogurt and other dairy products, and spices, are potential business opportunities under the unified Central America-Mexico trade agreement.
"There is a large niche in the Mexican market which is an opportunity for Nicaragua to place more and more products, to diversify their offering," said Rodrigo Melendez, manager of the economic and commercial section at the Mexican Embassy in Managua, reported LaPrensa.com.ni.
Central American countries will be able to access the Regional Integration Committee of Supplies, to supply raw materials for the development of Mexican goods, especially textiles.
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.
The business sector expects to achieve a 15% increase in trade between the two countries next year.
Nicaragua's private sector is awaiting the ratification of the unified Free Trade Agreement (FTA) between Central America and Mexico, which was signed last week and will be ratified by the presidents of the countries involved on 4th and 5th of December.
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.
"The agreement provides a common legal framework for the conduct of trade in goods and services between parties, as well as the establishment of investment in the region, he said in his announcement", reported Prensa Latina.
Costa Rica will export sugar duty free when supply in the Mexican market is insufficient.
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.”
Regarding the Rules of Origin and the Committee and Sugar quotas, the press release states that:
Access for sugar and the rules of origin for textile goods are delaying the negotiations for unification of the FTAs between Mexico and the region.
Before the 17th of October, the planned date for signing the agreement, negotiations in these areas must be concluded.
The Costa Rican Minister of Foreign Commerce (Comex), Anabel Gonzalez said ... that the general framework of rules or the convergence of three FTA’s between the isthmus and Mexico is finalised, except for ... very specific issues regarding the three products.
Mexico could allow privileges to those products in connection with the unification of the FTA.
In return, it requested access to CA of its dairy products, cars, avocado, steel and white corn.
Guatemalan Vice Minister of Foreign Trade, Raul Trejo, told Sigloxxi.com, "We must be aware that in negotiations you not always getting what you ask for; sometimes you need to yield in some areas.
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).
The Mexican Economy Secretary indicated in a communication summarised by Sigloxxi.com that, "the new treaty will expand the free trade zone and enable economic agents to work with one single set of trade rules, thereby facilitating and incentivizing the flow of trade and investment between the six participating countries".
The governments will begin negotiations to create a single regional agreement with Mexico which would be ready by 2010.
Mexico currently has three commercial agreements in the region, one with Costa Rica another with Nicaragua and the other with the Northern Central American Triangle (Guatemala, El Salvador and Honduras.)
The aim of the governments with the "Action Plan for the Convergence of the FTAs,” according to an article in prensalibre.com, is to "create "a single legal instrument to reduce transaction costs and facilitate trade as part of the integration process being driven by Central America."
Trade between Mexico and Nicaragua has grown sixfold since a free trade agreement between the two countries came into force in 1998.
Eduardo Sojo, the Mexican economy minister, said that trade between the two countries amounted to US$550 million last year. Nicaragua is now Mexico's third trading partner in the region, he added.