Costly Break to Regional Trade

Central American businessmen assure that the customs tax on the transport of cargo in transit or with final destination that the Nicaraguan government wants to impose "threatens the instruments of Central American integration, and becomes an obstacle to intraregional trade.

Thursday, March 21, 2019

Weeks ago it was reported that from March 15 would begin to collect the customs tax, however, the authorities did not specify what amount will be required from carriers. 

See "Nicaragua to Charge for Freight Transportation"

From FECAMCO's press release:

Central America, March 20, 2019. The Chambers of Commerce of Central America express their concern over the recent measure implemented by the Government of Nicaragua, regarding the imposition of a new procedure and collection for temporary imports of means of transport cargo entering the Republic of Nicaragua in international land customs transit operations to Nicaragua or in transit. The imposition of unilateral measures that threaten the instruments of Central American integration, become obstacles to intraregional trade affecting our second most important market, so we make the following considerations:

The Central American Economic Integration Secretariat (SIECA) already has a regional database of Central American carriers integrated into the TIM regional transit declaration platform, which creates additional delays and obstacles to the functioning of intraregional trade.

The delays at the border because of excessive bureaucracy already generate an increase in transportation costs to companies between 4% and 12%, so adding the charge established in Technical Circular 042-2019 further aggravates this situation. In addition, the application of this violent circular is an instrument of Central American integration as well as international instruments, such as: The 1994 General Agreement on Tariffs and Trade "Freedom of Transit", the Trade Facilitation Agreement "Freedom of Transit" and the Regulations on the International Customs Transit Regime, among others.

Therefore, we call on the Government of Nicaragua to suspend that measure and on all countries in the region to eliminate all existing restrictive measures and to refrain from imposing new ones that undermine regional instruments. The blockades that have been experienced so far have increased uncertainty and chaos at the borders, making the transit of goods in Central America even more cumbersome.

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