Sugar Tariffs: More Threats to Costa Rica

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%.

Tuesday, November 17, 2020

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.

At first the news was not well received by Brazil, since the South American country decided to raise before the World Trade Organization (WTO), a process to exercise the right of suspension, which consists in eliminating a certain tariff concession to one or more export products from Costa Rica.

Canada is the other country that joined Brazil's actions, since the North American nation warned the WTO that there is the possibility of imposing compensation against Costa Rica's decision to raise tariffs on imported sugar.

Duayner Salas, Minister of Foreign Trade, told Nacion.com that "... Canada's action is neither a complaint nor the beginning of a process against Costa Rica in the WTO. What Canada has notified the Council for Trade in Goods is its intention to reserve the right to apply suspension of tariff concessions."

Salas added that "... Costa Rica and Canada have maintained a frank and open dialogue on their assessments regarding a possible compensation for the effects of the imposition of a safeguard on imports of refined sugar. Such talks are still ongoing to date, so we will have to wait to know the outcome of these talks."



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: 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.

Avocado Conflict: Panel of Arbitrators is Formed

December 2018

The WTO was part of the panel of experts that will resolve Mexico's lawsuit against Costa Rica, arising from the barriers imposed by the Costa Rican authorities to import the fruit.

The trade conflict emerged because of the barriers that Costa Rica imposes since 2014 to the entry of avocado from Mexico.

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