Following Costa Rica's decision to impose requirements on the entry of avocados grown in Honduras, Costa Rican businessmen believe that these unilateral measures could generate trade retaliation for the country.
Arguing that molecular biology tests detected the presence of the Avocado Sunblotch viroid in shipments from Honduras, the Costa Rican State Phytosanitary Service (SFE) decided to start taking samples to analyze Honduran avocados.
Despite the complications that affected international trade due to the covid-19 outbreak, in Costa Rica in 2020, imports of grapes and oranges increased, a rise that is explained by the preference of consumers for fruits containing vitamin C.
The Foreign Trade Report of the Agricultural Sector 2019-2020, prepared by the Executive Secretariat of Agricultural Sector Planning (SEPSA), details that last year imports of fresh oranges in the country amounted to $14.8 million, 38% more than what was reported in 2019.
In Costa Rica, the Contentious Administrative Court ruled in favor of the companies who accused the government of damaging the local market, after the Solis administration banned the import of Mexican avocado in 2014.
The conflict, which remains unsolved, dates back to several years ago, when in May 2014 Costa Rican authorities decided to ban the import of avocados from Mexico, arguing the existence of the disease known as sun spot.
Since Costa Rica suspended the entry of Hass avocado from Mexico, countries such as Chile, Peru and Nicaragua have taken advantage of the situation to increase their exports to the Costa Rican market.
The dispute that is still unresolved dates back several years, when in May 2014 the Costa Rican authorities decided to ban the import of avocado from Mexico, arguing the existence of the disease called sunspot.
Almost three years after the beginning of the restriction of avocado imports from Mexico, citing supposed phytosanitary issues, the Solis administration is now promoting exports of Costa Rican varieties of the fruit, while the local market suffers from shortages.
The Ministry of Agriculture and Livestock announced with great fanfare that it has started an advice giving program to a group of Hass avocado producers in Tarrazú, so that they can start to export the fruit to European countries.
Hass avocados from Mexico can be imported in containers, provided that they come certified as fruit containers that are free from the sunspot disease or from areas certified as free.
The proposal put forward by the State Phytosanitary Service (SFE) to the Committee on Sanitary and Phytosanitary Measures at the WTO, where the conflict between Costa Rica and Mexico is being resolved, establishes that the fruit may be imported in any of three circumstances: the fruit is sent with a certificate that guarantees that it does not have sunspot, with a certificate that comes from areas free of the disease, or where there is compliance with rules agreed bilaterally by the two countries.
In Costa Rica since the government suspended imports of Mexican avocados in May 2014, the average wholesale price of the fruit went up by 19% in 2015 and 16% last year.
Since the country stopped the imports of mexican avocados because of the alleged presence of the sunblotch plague, the price of this fruit in the local market has kept on rising.Although avocados are now imported from seven different countries, total imports have fallen 25% since then, and the average price has recorded since then an annual increase of 18%.
The delay in phytosanitation studies by the Ministry of Agriculture has stalled the process for starting imports of avocados from the Dominican Republic.
Even though it has been a month since the Chamber of Exporters and Importers of Perishable Goods asked to be able to start the process of importing avocados from the Caribbean island, a delay in carrying out a study on the part of the State Phytosanitary Service (SFE) has prevented this from happening.
As expected after any government intervention in a market, the price consumers pay for the product has increased and a black market has been created, encouraging smuggling.
And the Costa Rican State itself risks having to pay millions in compensation for convictions for failing to comply with the procedures established by the WTO after blocking imports of avocados from Mexico.
Employers indicate that taking the dispute to an arbitration panel will cost many millions of dollars and will result in indemnization payments, as it is clear that trade agreements and phytosanitary standards were breached.
The announcement by the Mexican authorities to take Costa Rica to a World Trade Organization (WTO) arbitration panel because of the dispute over avocados, has caused concern among employers who are members of the Chamber of Exporters and Importers of Perishable Goods (Ceipp).
A technical analysis of the present and future of the avocado market in Costa Rica, states that reaching self-sufficiency, in the Hass variety, would take 20-30 years.
The current situation in the avocado market has encouraged discussion of import restrictions, protectionism and self sufficiency.
Luis Loria, an agronomist at the Experimental Station of the University of Costa Rica (UCR), noted in an article on Crhoy, "...
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