EU-CAAA Analysis: Nervous Producers

The Agreement with the European Union was closed this week; although nearly two years will pass before it take effect, the analysis of potential gains and losses is well underway.

Friday, May 21, 2010

Consolidating the tariff benefits of the Generalized System of Preferences (GSP), was labeled as a major accomplishment for Central America’s European-bound production. Whereas the GSP had to be reviewed periodically and unilaterally, the new rules are clear and permanent, thus enabling long-term planning.

The main objection to the final agreement is that Europe got more benefits and concessions from Central America than the ones achieved by the United States in DR-CAFTA. Europe is the third largest export destination for the region’s countries, after the United States and Central America itself.



More on this topic

Tariffs Lowered on European Liquors

March 2014

The trade association agreement between Central America and Europe means a reduction in import tariffs on alcoholic beverages.  

With the entry into force of the Agreement between Europe and Central America (CAAA) comes a reduction in import costs, which in the case of champagne is a cut of 15%.

Guatemala and Harnessing the Europe Agreement

January 2014

The elimination of tariffs on agricultural products and flexible rules of origin for products such as tuna, textiles and plastics are part of the changes incorporated in the Agreement.

The Minister of Economy, Sergio de la Torre said that in the next few years Guatemala's exports to Europe could be doubled, as has happened with the other trade agreements that the Central American nation has signed.

EU-CAAA Evaluation in Nicaragua

May 2010

The Association Agreement between Central America and the European Union is “historical”, stated José Adán Aguerri, president of COSEP, the Superior Council of the Private Enterprise.

According to him, Nicaragua gets many benefits from the agreement, including assuring some key beneficial tariff conditions when exporting to Europe, which include zero tariffs for all its agricultural goods and 99% of the country’s industrial production. EU-CAAA made permanent the advantages Nicaragua had under the Generalized Preferences System (SGP Plus), removing the transitional and discretional nature of the former system.

EU-CAAA: Effect on Costa Rica

May 2010

Between 2 and 5 years will pass until the Association Agreement with Europe enters into force, but Costa Rican exporters are already studying how to compete in that market.

Being more and more competitive seems to be the basic recipe to effectively compete in the EU’s 500 million person market.

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