Sugar: Brazil to Resume its Complaint against Costa Rica

On April 26, Brazil will reactivate again on the agenda of the World Trade Organization, the complaint against Costa Rica for the imposition of a safeguard to increase the tariff on sugar.

Friday, April 23, 2021

The dispute began when in June of this year the Alvarado administration decided to increase to 79% and for a period of three years, the tariff on sugar entering the country. The argument for raising the percentage was that the unusual growth of imports was harming local production.

In response to this protectionist measure, in October of last year the Brazilian government decided to bring to the Council for Trade in Goods of the World Trade Organization (WTO), a process to exercise the right of suspension, which consists of eliminating a specific tariff concession for one or several products exported from Costa Rica.

After months of the case remaining inactive, Antonio Da Costa e Silva, Brazilian ambassador in Costa Rica, told Nacion.com that the South American country "... will reactivate again in the WTO agenda, the complaint against Costa Rica on the issue of the imposition of a safeguard to increase the tariff on sugar."

You may be interested in "Sugar: Protectionism and the eternal struggles"

Da Costa e Silva said that Brazil "... maintains the hope that the issue will be solved in bilateral meetings (of the two countries involved), which are being held for this purpose."

Maquila Lama, a sugar importer that has filed appeals against this protectionist policy, has already made a statement regarding the reactivation of the case.

In a statement issued by the company, the general manager of the organization, Juan Carlos Sandoval, said that "... since the imposition of 72.68% tariffs on sugar imports, this decision represents an excessively protectionist tariff barrier and is in danger of going back to the times when there was no other option for the national consumer."

Sandoval added that "... if the safeguard level is maintained, the competition in the sugar market is in danger and if there is no agreement, possibly the import brands could not compete with the national industry and we would return to the system of having only one brand in the country, eliminating the competition that has existed since 2014."

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More on this topic

Consequences of Protectionism

November 2020

Based on the willingness of Costa Rican authorities to raise the tariff on imported sugar from 45% to 73%, Brazil decided to raise the entry taxes on four animal products from Costa Rica.

Months ago, the private sector has been warning of the possibility that the country's trading partners would apply reciprocal measures because of Costa Rica's unilateral decision to raise entry taxes on imported sugar.

Sugar Tariffs: More Threats to Costa Rica

November 2020

Following in Brazil's footsteps, Canada warned the WTO about the possibility of imposing compensation against the Costa Rican authorities' policy of raising the tariff on imported sugar from 45% to 73%.

Arguing that imports were growing unusually high and local production was being undermined, in June of this year the Alvarado administration decided to increase the tariff on sugar entering the country to 79% and for a period of three years.

Sugar Tariffs: Brazil Denounces Costa Rica

October 2020

After the Costa Rican authorities raised the tariff on imported sugar from 45% to 73%, the South American country decided to raise before the World Trade Organization, a process to exercise the right of suspension.

In June of this year, the Alvarado administration decided to increase to 79% and for the term of three years, the tariff on sugar entering the country.

Protectionism in Times of Crisis

June 2020

Arguing that the unusual growth in sugar imports is harming local production, the Alvarado administration decided to raise the tariff on products entering Costa Rica from 45% to 73% for a three-year period.

The Ministry of Economy, Industry and Commerce (MEIC) concluded the investigation requested by the Agricultural Industrial League of Sugar Cane (LAICA) and 4 mills, on the safeguard measure against imports of solid state, granulated sugar, known as white sugar, used for domestic and industrial consumption, justifying a deterioration in the main economic indicators of the National Production Branch (RPN), details an official statement dated June 15.

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