The Never Ending Tariff Conflict between Panama and Colombia

The Panamanian government has decided to increase, in some cases by up to 30%, import tariffs on several products, including flowers, cement and bituminous coal, most of which are imported from the South American country.

Wednesday, February 7, 2018

According to a Cabinet Decree published on January 10 in the Official Newspaper, the Panamanian government decided to modify several fractions of the National Import Tariff, taxing at 30% imports of roses, carnations, chrysanthemums, calla lillies, astomerias, gladiolas and "flor de confite" (Calyptronoma plumeriana (Martius) Lourteig), which mostly come from Colombia.

Imports of bituminous coal will be taxed at 15%, purchases of white cement at 5%. Added to the list of products with a tariff of 30% are toilet paper and paper towels.  

Far from being resolved, the problem seems to be getting more and more complicated. What started more than two years ago with the imposition by Colombia of mixed tariffs on imports of textiles and footwear from Panama has turned into a kind of commercial war, in which both countries are using tariff increases to defend their position. See details of the tariff dispute between Panama and Colombia.

The new tariffs apply from February 1 of this year. See decree (in Spanish).

More on this topic

Panama and Colombia Try to Resolve Tariff Dispute

June 2018

The business associations of both countries started working on a joint plan to solve a problem that has been causing them damage for the last six years.

Representatives from the Chamber of Commerce, Industries and Agriculture of Panama (Cciap) and members of the Chamber of Commerce of Bogotá, initiated talks to develop a joint plan to end the conflict that has affected them since 2012.

Tariff Conflict Between Panama and Colombia

March 2018

A little more than a month after the Panamanian government decided to raise import tariffs on various products as a measure of retaliation against the South American country, representatives from both governments reaffirmed their positions at a WTO hearing.

The outcome of the hearing will be announced by the WTO between August and September, according to the rules that govern the agency. 

Panama: Retaliation Against Colombia

November 2017

If the request by the Panamanian Ministry of Commerce and Industries is approved, a new tax of up to 40% could be established on the dividends distributed by Colombian companies.

In response to a decision by the Colombian government to extend the import tariff for footwear and textiles from Panama for two more years, the Panamanian Ministry of Commerce and Industries has asked the Foreign Ministry to apply the retaliation law, which has been in place since October of last year and which penalizes companies from countries that discriminate against Panama.

Panama Adopts Tariff Measures Against Colombia

August 2016

From August 16 until December 31 2016 a higher tariff will be imposed on imports flowers, coal, unpulverized cement and clothing.

Although the statement from the Presidency of Panama does not directly refer to Colombia, the products for which import tariffs have been increased mainly come from the country that, despite rulings by the WTO to the contrary, has extended the term for additional tariffs on goods imported from the Colon Free Zone.

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