Nicaragua: Trade Agreement with Europe At Risk

The European Parliament will evaluate Nicaragua's possible suspension of the Association Agreement, which allows 91% of products, mostly agricultural, to enter the 28 EU countries under preferential conditions.

Thursday, March 14, 2019

The European Parliament plans to discuss Nicaragua's suspension of the Association Agreement (AA), an agreement that allows 91% of products, mostly agricultural, to enter the 28 EU countries under preferential conditions.

You may be interested in "More Taxes in Times of Crisis" and "Figures from the Crisis"

For Guillermo Jacoby, president of the Association of Producers and Exporters of Nicaragua (APEN), "... a suspension of the country's European agreement would remove Nicaraguan products from preferential entry into that market, i.e. they would start paying taxes, which would make them less competitive. That commercial advantage that Nicaragua would lose would be won by the other Central American markets that are also part of the Association Agreement, which would represent a blow for Nicaraguan exporters with effects at the domestic level."

Jacoby explained to that "... We are on the edge of a social collapse, an economic collapse', and if European threats materialize, thousands of jobs would automatically be lost, foreign investment would come in search of the European market and exportable production would fall."

In addition to economic sanctions, MEPs called for the Sandinistas not to be granted visas to travel to the EU and for their accounts to be frozen on EU territory until human rights are restored in the country.

The sanctions approved for the high command of Daniel Ortega's government, was made with ample majority, however, the final decision to impose them or not, will depend on the foreign ministers of the European Union (EU).

See article in "European Parliament calls for sanctions against Ortega's regime in Nicaragua" and "Exporters worried about Nicaragua's request for suspension of the Association Agreement with the EU".

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More on this topic

EU Pressures Nicaragua

December 2019

The European Parliament's plenary session proposes that the European Commission apply the democratic clause in the EU-Central America Association Agreement, which would involve Nicaragua's withdrawal from the agreement.

Almost two years after the start of the political and economic crisis in Nicaragua, MEPs are proposing to sanction the Ortega administration with the eventual withdrawal of the country from the trade agreement.

Nicaragua: Exports Will Not Rebound in 2019

January 2019

The exporters' guild estimates that the new year will be difficult for the country's economy, since there are multiple factors that threaten the growth of foreign sales.

The Association of Producers and Exporters of Nicaragua (APEN) reported that the expectation of year-on-year increase in export revenue for 2018 ranged between 6% and 10%, however, there was a 1% decrease.

Gloomy Prospects for Exports

June 2018

Nicaraguan business leaders estimate that in the months of June and July there will be drastic drops in exports.

In the first five months of the year, the country sold $1.282 billion worth of goods abroad, which is 2% more than what was reported in the same period in 2017. However, the business sector says that this increase was due to the fact that many exporters decided to liquidate most of their inventory at the beginning of the crisis. 

Association Agreement with EU as of May 15

March 2013

Honduras and Nicaragua will be the first countries to export to the European market under the preferential tariff agreed between the two regions.

The agreement will be effective only in these two countries, as the parliaments of the rest of the region have not yet ratified it.

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