The loss of competitiveness facing the food industry is the reason that exports have fallen from $1,124 million in the first ten months of 2013, to $1,051 million in the same period in 2014.
High interest rates, higher inflation, credit constraint in production, lower growth and a sharp reduction in sales are some of the problems facing the food sector which reported a decline of 6.5% in foreign sales.
The presidential candidate Luis Guillermo Solis announced he will strengthen intraregional trade if he wins on April 6th.
In a meeting with representatives from the Costa Rican Chamber of Food Industry (Cacia), Luis Guillermo Solís, presidential candidate of the Citizen Action Party, said that a new government would strengthen trade with Central America and the Caribbean.
The Costa Rican Chamber of Food Industry believes that the trade agreement could pose a threat to Costa Rican production.
From a press release by the Costa Rican Chamber of Food Industry (CACIA):
In a letter addressed to the members of the Committee for International Relations and Foreign Trade, the Costa Rican Chamber of Food Industry, CACIA, once again was vehement in its opposition to the possible approval of the FTA with Colombia, by the Legislative Assembly .
As part of the border posts improvement plan, the Government is proposing a toll, charging $25 per export declaration and $5 per person.
The charge would be implemented at the border crossings at Peñas Blancas, Sixaola, Paso Canoas and Las Tablillas (Los Chiles).
Proceeds will be used to pay back the $80 million loan granted by the Inter-American Development Bank to finance the construction, equipping and improving processes at these border posts and to create a fund to maintain them. Some 4% would be paid to the municipalities where the crossings are located.
The Costa Rican customs office at Penas Blancas, on the border with Nicaragua, is going through social and commercial chaos pending reforms in infrastructure and procedures.
Delays in the passage of trucks carrying goods are causing major losses to exporters, although business chambers have not conducted any specific studies, said Mario Montero, executive vice president of the Costa Rican Chamber of the Food Industry (Cacia).
Agricultural producers have pointed out that the Colombian economy is in direct competition with the Costa Rican one in terms of production, and they see no profit in a trade agreement.
The agricultural and agribusiness sectors of Costa Rica joined the national industrial sector in opposing a possible FTA with Colombia because of its economy’s highly competitive position in relation to Costa Rica.
A study by the Foreign Trade Promotion Office reveals opportunities emerging for the sector with the eventual signing of an FTA with South Korea.
"Korean imports of bovine meat in boneless cuts increased by 7.8% between 2008 and 2010, those for unroasted coffee by 12.2%, 22.2% for roasted coffee, sugar cane by 27, 2%, pasta by 3.3% and 14.4% for food preparations", published Elfinancierocr.com.
Temporary closing of highways to port of Caldera and Inter-American Highway to the north are negatively impacting on commerce and trade with the region.
Betsabe Alvarez, of the Chamber of Exporters of Costa Rica (Cadexco), said to Nacion.com that the sectors most affected by the closing of the highways are agricultural and dairy products. She added “Exporters are canceling orders as well as sending trucks and containers.
The expected growth projections for Panama that emerged after the ratification of NAFTA have not been achieved.
The vice president of the Chamber of Costa Rican Exporters (Cadexco), Sergio Navas, attributed one of the causes to the economic crisis but he also recognized that they should improve logistics systems.
Tatiana Gutierrez highlighted the statements of Mario Montero, executive director of the Costa Rican Chamber of the Food Industry (Cacia), for Prensalibrecr.com: “...the food industry requires commerce liberalization for their commodities, some of which still have very high tariff plans as well as significant protections through the treaties currently in effect."
Costa Rica hopes use the FTA with China to capture production investment from Chinese companies which will export their products throughout Central America
China plans to use Costa Rica as the bridge to export to the other countries with which the Central American country has trade agreements, such as Mexico, the United States and Canada.
In his article on Nacion.com, Marvin Barquero says that: "This event, which means attracting a lot of Chinese investment, is one of the great expectations generated by the negotiation of the FTA with China, which started yesterday."