During the recent visit of the Ecuadorian president to Guatemala, the intention to take up again the issue of the Free Trade Agreement between the two countries, whose negotiation was stalled years ago, was expressed.
As a result of the inauguration of the new Guatemalan government, Ecuadorian President Lenin Moreno visited the Central American country and took advantage of the occasion to meet with Guatemalan businessmen.
With the recent signing of the U.S.-Canadian-Mexican trade agreement, a precedent was set for future negotiations, as this agreement sets binding labor conditions, such as making exports subject to the payment of a minimum wage.
For example, one of the conditions of the Treaty between Mexico, United States and Canada (T-MEC), which was signed on December 10, 2019, is that vehicles exported from one state of Mexico to the other two countries "must come from plants that pay wages not less than $16 an hour.
Guatemalan authorities announced that in the first week of October they will travel to South Korea, with the aim of restarting negotiations of the Free Trade Agreement between the two economies.
Guatemala is the only Central American country still negotiating the Free Trade Agreement (FTA) with South Korea, since El Salvador, Panama, Honduras, Nicaragua and Costa Rica signed it in February 2018.
In the last week of September, the first round of negotiations for the deepening and extension of the Partial Scope Agreement between the two countries is scheduled to take place in Havana.
The second round of negotiations will take place in Guatemala City during the week of October 7-11 this year, and will analyze in depth access to markets and rules of origin, in order to advance in the exchange of negotiating positions, informed the Ministry of Economy of Guatemala (Mineco).
The first round of negotiations began in the South American country to expand the list of products already traded in the framework of the agreement that has been in force since 2013.
The agreement that entered into force on February 19, 2013, has allowed immediate access to 593 products with 100% tax relief. In addition, it reduces tariffs on 84 products between 20% and 100% over 3 and 7 years, informed the Guatemalan government.
It is announced that technical groups from the governments of El Salvador and Guatemala began negotiations in London to conclude a new trade agreement.
Now, there is a possibility that the agreement the region seeks to sign with the European country will not be consolidated, since it is not yet clear how the process of Britain's exit from the European Union will be carried out, an issue that is generating great tension between the British Parliament and Prime Minister, Theresa May, at this very moment.
For this year, one of the priorities Morales administration has as a priority to advance in the signing of free trade agreements with South Korea, Israel and the United Kingdom.
Representatives of the Ministry of Economy (Mineco) reported that by 2019, among the priorities of the agenda is the resumption of discussions of the trade agreement being negotiated with South Korea.
On November 12th, the VII Round of Negotiations for the inclusion of El Salvador in the integration process towards the free transit of individuals and goods between Guatemala and Honduras began in San Salvador.
The negotiations between the three countries will last the entire week and it is expected that this round of dialogues will address issues related to the customs, migration, sanitary and phytosanitary challenges facing El Salvador.
The FTA with Panama and the agreement with El Salvador, both in the negotiation stage, are part of the commercial opportunities that the Asian nation seeks to consolidate in the region in the short-term.
The third round of negotiations to conclude the trade agreement between the Central American country and the Asian nation began in Panama City. This session will deal with trade barriers, customs procedures and trade facilitation.
In Guatemala, business associations, mainly in the export sector, are insisting that the government resume negotiations and complete the process of adhesion to the trade agreement with the Asian country.
The private sector groups explained that despite the commercial opportunities that Guatemalan companies have with South Korea, Guatemala is the only country in Central America that has not completed negotiations to sign the FTA, meaning that they are unable to take advantage of the benefits that this agreement offers.
With the aim of favoring mainly agricultural products, the Morales administration has announced that it will propose to the Israeli government starting negotiations for a free trade agreement.
In the coming days a Guatemalan government delegation will be visiting Israel, a trip which could be leveraged for representatives of the Ministry of Economy to raise the possibility of signing a trade agreement between the two countries.
The practice of trying to get a discount is acceptable in some places, while in others, depending on the product or service in question, it can lead to doubts and harm negotiations.
Ariel Baños, expert in defining pricing strategies, explains that when negotiating a reduction or increase in a price, one must take into account the cultural factors of each country, which can differ greatly from one place to another. "...In some countries, such as Egypt, Morocco and India, and in Southeast Asia in general, it is common to negotiate prices on all types of products and services. It can even be considered offensive if the client pays the initial price, without even making an attempt to get some money off."
Inability to reach a consensus with the business sector is one of the reasons why the Morales administration has decided to postpone negotiations for a trade agreement until 2018.
The government explained that in the remainder of the year negotiations with representatives from the business sector will be finalized in order to define aspects on which there is no agreement, so as to resume talks with the Asian country next year.
Both governments are trying to reach a consensus on issues regarding market access and rules of origin in the agreement which other Central American countries already signed in November 2016.
From a statement issued by the Ministry of Economy:
Guatemala and South Korea, told their Central American peers that they are continuing to make efforts to finalize bilateral FTA negotiations, seeking to respond to the interests of both countries.
Bilateral negotiations will continue in order to reach an agreement on an "appropriate balance of commercial interests" for both countries.
From a statement issued by Mineco:
Guatemala, November 16, 2016. Guatemala will continue the process of FTA negotiations with South Korea bilaterally. The other Central American countries plan to officially finalise negotiations in Managua, Nicaragua, during the meeting of Ministers and Secretaries in charge of foreign trade of each country.