Bridges Weekly Trade News Digest • Volume 13 • Number 29 • 5th August 2009

Colombia and Peru – Minus Ecuador – Forge ahead in EU Trade Talks

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Negotiators from Colombia and Peru completed a fifth round of negotiations toward a free trade deal with the EU last month, despite the marked absence of Ecuador from the discussions. Although an estimated 30 to 50 percent of the tabled issues have yet to be resolved, officials said the talks achieved significant progress in several areas.

The Ecuadorian delegation, which had been tentatively engaged in the talks since they were launched in 2007, suspended its participation in the negotiations after President Rafael Correa reportedly met with state ministers, the chief negotiator of Ecuador and other officials.

The country’s withdrawal from the talks had been rumoured for weeks (see Bridges Weekly, 27 May 2009, http://ictsd.net/i/news/bridgesweekly/47399/).

On 10 June, Ecuador’s government reportedly sent EU negotiators a letter outlining a ‘Memorandum of Understanding on Bilateral Political Dialogue and Cooperation,’ and laying out the country’s concerns on several issues, including government procurement, investment, labour rights and social guarantees of Ecuadorian migrant workers in the EU. Quito says that the EU still has not responded to the letter.

Quito’s absence from the negotiations is also due in part to a long-running dispute with the EU over its banana tariffs (see Bridges Weekly, 3 December 2008, http://ictsd.net/i/news/bridgesweekly/35126/). Ecuador wants Brussels to comply with a WTO ruling that concluded that the EU’s tariffs on banana exports from Latin America are too high. So far, though, Brussels has yet to do so.

“If the EU doesn’t comply with the WTO, we won’t continue to negotiate that trade agreement,” Ecuador’s Correa said last month in his regular weekend radio-and-television broadcast. “In the end we might lose a few dollars; however, we won’t lose our dignity.”

Colombia and Peru push ahead

With Ecuador on the sidelines, negotiators from Colombia and Peru got down to work. Among other things, the parties agreed to remove unnecessary technical barriers to trade, and to facilitate trade by promoting the exchange of information and simplifying certification processes. The negotiators also agreed to strengthen institutions and make improvements to infrastructure, equipment, and human resources, according to official information from Colombia’s Ministry of Commerce.

Despite positive sounds from officials, some in civil society are wary of the negotiations. Several non-governmental organisations closely following the talks - including DAR, Foro Ecológico, CIMA, Traffic, and CooperAcción RedGE - disagree with the governments on the results they have claimed to achieve in sustainable development.

Critics warn that the EU will not commit additional resources to help the Andean countries adapt to meet stricter standards on labour rights and environmental protections. The organisations claim that environmental and labour laws have been weakened to promote trade and investment. With only weak laws on the books, any free trade agreement would remain purely declarative, as the Andean governments would lack the enforcement mechanisms to compel the parties to implement it, the groups say.

The sixth round of negotiations will take place in Brussels the week of 21 September.

ICTSD reporting; translated and adapted from Puentes Quincenal, Vol. 6, No. 14; “Correa says EU must cut banana levy for trade talks to progress,” BLOOMBERG, 18 July 2009.