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The trade agreement between Ecuador and the European Union enters into force
Posted On 03 Jan 2017
The trade agreement signed between Ecuador and the European Union (EU), which will save Ecuadorean exporters millions of dollars in tariffs, came into force on Sunday after a hasty negotiation before the end of tax preferences.
Ecuadorian authorities, who estimate a GDP growth of 1.4% for 2017, are optimistic about the impact the economy will have on the trade agreement, which opens the door to a market of 513 million people in 28 countries.
Madeleine Abarca, head of the Central Bank of Ecuador, said last week that the country “is going to have a growth in its economic activity,” which “is due to an increase in exports … influenced by the oil prices and also by the closure of the agreements with the European Union.”
On December 31, the benefits granted by the EU to Ecuador, which in 2016 faced economic difficulties aggravated by the earthquake of April 16, the fall in oil prices – its main export product – and the appreciation of the US dollar.
In this context, Ecuador signed the multiparty trade agreement with the European bloc on November 11 in Brussels, which also includes its neighbors Colombia and Peru since 2013. “Ecuador’s zeroing (tariffs) does not give it an advantage over the others, but it avoids a disadvantage. Because if we had not signed the agreement on January 1, we would have to pay extremely high tariffs to export to Europe,” said analyst Pablo Lucio Paredes, dean of the Faculty of Economics at the University of San Francisco.
