EU’s trade deal with Central American nations takes effect
August 02, 2013 - Europe
A trade agreement between the EU on one side and the Central American nations of Honduras, Nicaragua and Panama on the other has set into motion from August 1, 2013.
The trade agreement, which was part of an Association Agreement signed in 2012, has opened up markets and is likely to create a stable business and investment relation between the European countries and Central America.
The comprehensive trade part of the agreement opened up markets for goods, public procurement, services and investment on both the sides.
"The Association Agreement is a proof of the EU’s interest and involvement in Central America, the benefits would not only be economic but would bring a positive impact on political integration as well," Karel De Gucht, the EU Trade Commissioner, said in a statement.
The agreement would reinforce economic integration and promote sustainable development in the regions, as well as set up institutions to tackle trade related issues and provide a transparent way to settle trade disputes.
The agreement would create a stable business and investment environment based on predictable and enforceable trade rules which, in many instances, go further than the commitments the parties have made in the World Trade Organization (WTO).
The EU is Central America's second largest trading partner. In 2012, the total trade flows in goods amounted to €14 billion, including approximately €1.4 billion worth of trade with Honduras, €1.2 billion with Panama and €0.4 billion with Nicaragua.
As per the ‘marking and labeling’ part of the agreement, textiles and clothing items would need to have the information on fibre content, country of origin, safety instructions for specific uses and care instructions. Both the parties have to adhere to this provision within one year from the entry into force of the Agreement at the latest.