Costa Rican businessmen complain that because of export subsidies granted to sugar producers in India, there has been an artificial increase in production, causing prices to fall below costs.
Édgar Herrera, executive director of the Industrial Agricultural League of Sugarcane (Laica), explained to Elobservador.cr that "... These subsidies are greater than those allowed by the World Trade Organization, in the order of $10 billion annually.
The nicaraguan government has announced a new subsidy on the interest rate for apartments´purchases worth up to $50,000 and constructed within buildings with no more than four floors.
In addition to this new incentive to purchase housing classified as social interest and in high rise form, the Ortega administration has announced that it will expand from $32 thousand to $40 thousand the maximum value of high rise housing that is eligible for the current interest rate subsidy.
December 31st is the deadline set by the WTO for Costa Rica, El Salvador, Guatemala and Panama to stop subsidizing exports from free zones.
In her article on Eleconomista.net, María José Saavedra analyzes "... the long road of extensions and extensions" which is coming to an end now with the World Trade Organization (WTO), having set 31st December 2015 as the last date for the elimination of these subsidies.
In 2016 scheduled tariff reductions for rice imports begin as part of the DR-CAFTA, posing a threat to local producers.
Nicaraguan rice producers have pointed to the efforts made by the sector to achieve self-sufficiency in supplying the local market, and report that the main competitor unleashed by this tariff reduction is the US which they point out subsidizes rice production.
The U.S.'s approval of a new farm bill may increase the competitiveness of the agricultural production in the Central American market.
The U.S. Congress has passed a farm bill that authorizes $956 billion over five years, including subsidies to domestic producers, eliminating direct farm subsidies.
"... The decision to end the system, established eighteen years ago, to make direct payments to farmers in cash , cost over $4.5 billion a year." It is estimated that "about $16 billion will be saved in government spending over the next decade ... ".
The Costa Rican government has informed the WTO that from March next year it will cease the pricing system by which domestic rice producers are subsidized.
From 1st March 2014 rice subsidies will be removed, which could end the dispute with the U.S. and other WTO members on account of aid given to rice farmers.
In a statement that the Government of Costa Rica sent to the World Trade Organization (WTO), the country said it will eliminate aid for rice farmers through a decree approved last month.
The Government of Colombia and the Coffee Growers Committee have agreed to an additional increase from $33 to $63 per load of grain to farmers with less than 20 hectares.
Growers with more than 20 hectares will go from receiving $33 to receiving $52 per grain load.
From a press release issued by the Presidency of the Republic of Colombia:
President Juan Manuel Santos said on Saturday that the government and the Coffee Growers Committee have agreed to further increase the Income Support for Coffee Growers from 60,000 pesos to 115,000 pesos ($33 - $63) per load of grain for farmers under 20 hectares.
Central American exporters are on alert after the Colombian government decided to increase the protection for domestic footwear and textiles industry.
These measures will apply to imports from those countries Colombia does not have a Free Trade Agreement (FTA) with. In addition, a subsidy will be granted to the coffee sector totalling around $44 million.
There should be time limits placed on any subsidies given to sectors of the population or the economy, so that they do not end depending on the state.
Martesfinanciero.com studied the case of subsidies granted by the Panamanian government, invoking the old adage "Give a man a fish and he'll eat for a day, teach him to fish and you’ll feed him for the rest of his life."
For each load of 125 kilos of coffee, coffee farmers will receive $33 as compensation for the fall in international coffee prices and the devaluation of the Colombian peso.
A statement from the Ministry of Finance of Colombia reads:
Government triples coffee subsidies: 80 billion pesos ($ 44 million) for 600,000 families.
So announced the finance minister, Mauricio Cardenas, on Saturday at a press conference.
Corn shortage is adding to the already existing shortage of bean. Escalating international prices are threatening millions of poor Central Americans.
January global data shows that food prices continue to rise and are already surpassing the 2008 prices.
And while the Central American economies are benefiting in part by the increase, for example by increasing revenues from coffee and sugar exports, they have not secured supply of basic traditional consumer products such as wheat, corn and beans; the basic foods of poor population. The already high prices are worsened by poor harvests due to bad weather.
The new offer increases the quota for sugar from Central America that can enter the European Union without tariffs to 100,000 tons.
According to La Prensa Gráfica, the president of the Sugar Association of El Salvador, Armando Arias, indicated that "the Minister of the Economy said publicly that he knew–off the record-that the EU might offer up to 100,000 tons to Central America.”
Sardimar and Calvo Group are involved in a dispute over tariffs generated by the implementation of the multilateral treaty imposed by the US-Central America Treaty.
The Spanish-owned Calvo Group has a tuna processing plant in El Salvador from which it exports to Costa Rica - among other places - having paid the country a customs duty of 15% until January 2009, and afterwards taking advantage of CAFTA benefits by not paying the tariff for tuna in oil and paying 2.2% for tuna in water. This will obviously hurt the local sales of Costa Rican-owned Sardimar, which is protesting, stating that the situation violates the provisions of the General Treaty of Central American Integration since Calvo Group operates in a free trade zone in El Salvador and is exempt from most national and municipal taxes and Sardimar considers this a subsidy in disguise.