Costa Rica’s Legislative Assembly approved a trade agreement between Costa Rica and the United Kingdom that protects commercial conditions previously negotiated with the European Union (EU).
The agreement ended months of high uncertainty for the national export sector. Under the agreement, the trade relationship between the two nations will remain intact and protected against Brexit.
Legislators approved Monday night (Oct. 28) in second debate – unanimously – the Acuerdo de Asociación entre Centroamérica y el Reino Unido (AACRU).
Dyalá Jiménez, Costa Rica’s foreign trade minister told Elfinancierocr.com that “… With Brexit we need to make sure that trade flows are not going to be interrupted and that there is not going to be a great deal of uncertainty. For the last year we have been able to negotiate and work on an agreement that replaces the association agreement between Central America and the European Union.”
The AACRU was signed on July 18 between authorities of the United Kingdom and representatives of the Central American countries (El Salvador, Guatemala, Honduras, Nicaragua, Costa Rica, and Panama). This agreement is complemented by the Acuerdo de Asociación entre Centroamérica y la Unión Europea (AACUE), which has been in force since October 2013.
The new agreement serves to maintain the commercial conditions initially negotiated with the European bloc, so that they prevail in the new direct relationship between the Central American nations and the United Kingdom.
“Without this agreement, Costa Rican products to the United Kingdom would go to the conditions of the World Trade Organization (WTO) with which additional fees apply and this would make our products much more expensive,” said Kenneth Waugh, president of the British Chamber of Commerce – Costa Rica (Brit Cham).
Banana leads exports to the UK
“Costa Rica is the second largest supplier of bananas in the United Kingdom with a 21% market share. Of the total exports to that country, bananas accounted for 41%, so this destination is considered an important trading partner,” added Waugh.
Fast track legislation
“We joined forces between the work teams (of the Ministry of Foreign Trade, advisors and legislators) and called on the rest of the commission to understand that we had to assume a project of high importance for the country,” said Karine Niño, legislator of the National Liberation Party (PLN) and president of that legislative forum.
The approval of this trade agreement means greater clarity for the Costa Rican export sector that was waiting for legislation that would dissipate the doubts caused by the intense discussion of Brexit.