Last year, trade in paints and varnishes between Central American countries amounted to $123 million, which is 10% lower than in 2019, a drop that was reported in the context of the economic crisis resulting from the Covid-19 outbreak.
Figures from the Trade Intelligence Unit of CentralAmericaData: [GRAFICA caption="Click to interact with the graph"]
Unless intra-regional trade in chemical contents and residues, micronutrients and food preparations is regulated in a balanced manner, trade relations in Central America could face obstacles in the future.
Trade between Central American countries is essential, since a considerable proportion of foreign sales by local companies are destined for other markets in the region.
Due to the tropical storms Eta and Iota, severe damage has been reported to the road network in Central American countries, and some border posts in Guatemala, Honduras and El Salvador have been suspended.
Since November 17, operations were suspended at the El Corinto, El Florido and Aguas Calientes border posts. These areas, shared by Guatemala and Honduras, are not operational, according to the Guatemalan Superintendence of Tax Administration (SAT).
Arguing that there is unfair treatment in the other countries of the region, Costa Rican drivers of cargo vehicles block the transit through the border posts of Penas Blancas and Paso Canoas.
The protests in Costa Rica, which affect vehicle circulation in the country and border crossings, will have a short-term impact on intraregional trade and cargo transport costs.
In order to access the $1.75 billion credit that it intends to request from the International Monetary Fund (IMF), the Costa Rican government proposed to tax financial transactions, raise the tax on the profits of companies and individuals, and increase the tax on real estate.
Local authorities decided to extend from 3 to 10 days the maximum period that drivers of international cargo transport are allowed to stay in Salvadoran territory to unload or load merchandise.
Due to the spread of covid-19 Costa Rica was the first country to impose restrictions on cargo transport units from other countries in the region. Faced with this decision taken unilaterally, the governments applied reciprocal measures.
Currently, transporting goods by sea between Central American countries can increase freight costs by at least 60% compared to the land option, which represents an obstacle to changing the way goods are transferred in the region.
As a result of the closure of the Penas Blancas customs crossing, on the border between Costa Rica and Nicaragua, some businessmen in the region had to resort to the sea route in order to deliver their orders.
The Panamanian government announced that it had reached an agreement with the Costa Rican authorities that Panamanian heavy transport units would be given a 72-hour period to load and unload goods in tax offices.
Since El Salvador, Costa Rica and Panama have set a 72-hour time limit for freight drivers operating in the region, hundreds of units have decided to halt their operations as a measure of pressure.
Due to the health crisis resulting from the covid-19 outbreak, Salvadoran, Costa Rican and Panamanian authorities decided that the drivers of the cargo transport units entering the country will have only 72 hours to make the formalities at the borders, and to unload and reload the goods from the vehicles.
Local authorities announced that as of March 7, cargo vehicles traveling through the country from Costa Rica will no longer pay $50 at Nicaraguan customs.
Guatemala, El Salvador and Honduras agreed that May 4, 2020 is the new date for the use of the Central American Single Invoice and Declaration.
From the Agexport statement:
September 30, 2019. The Ministry of Economy through the Vice-Ministry of Integration and Foreign Trade announced on September 27, 2019 that in a meeting with the Ministerial Instance of the Customs Union of the Republics of El Salvador, Guatemala and Honduras it was agreed as follows:
In the first three months of 2019, trade in paints and varnishes between the countries of the region totaled $31 million, 3% more than in the same period in 2018.
Figures from the Trade Intelligence Unit of CentralAmericaData: [GRAPHIC caption="Click to interact with graphic"]
After having been extended several times, the contingency plan for DUCA F and DUCA was finalized on July 8, however, there is uncertainty because the platform is not fully operational.
Because the implementation of the Central American Single Declaration continues to generate problems in customs in the region, the contingency plan for DUCA F and DUCA was extended until June 27.
"If you use the Contingency Plan, we suggest that you make sure you arrive at the destination country with the DUCA F and DUCA T duly processed and the supporting documents," reported the Guatemalan Association of Exporters.