Two months before it enters into force, Costa Rica’s free trade agreement with Colombia will operate on a trade balance that currently favors Colombia by a great margin.
Colombia exported $307 million into Costa Rica, while Costa Rican companies managed to export only $76 million into Colombia, resulting in a $231 million deficit for the Central American nation, reported Procomer, Costa Rica’s foreign trade promoter.
What worries Costa Ricans the most is probably what regards food and agriculture. Mario Montero, executive vice-president of the Costa Rican Food Industry Chamber expressed that business opportunities abroad for food companies are going to be relatively scarce.
On the other hand, Alexander Mora, Costa Rica’s Minister of foreign trade has a more positive outlook, and cited the fact that Colombia can be a reliable provider of raw materials, which might reinvigorate Costa Rican industry. Also, with the agreement in place, his country will gain access to a market which equals Central America in size.
The Minister also made a call to businessmen to “cast away their fears and take advantage of the agreement”.
However, limitations for Costa Rica go beyond the simple imbalance. A study carried out by the aforementioned Procomer showed that when it comes to pasta, snacks and sauces, Colombians are loyal to local brands, and estimated that opportunities for Costa Rica are limited to just 7% of the market in that regard.
Still, for Francisco Gamboa, executive director of Costa Rica’s Chamber of Industry, the specifications of the agreement reflect his interests, as he claims the expectations of the Costa Rican industry were met.
For Colombia, the agreement is largely positive, mainly due to the fact that 98% of exports to Costa Rica are not mineral goods, which means that through the agreement Colombia will have a good opportunity to develop its industrial sector.
The products with which Colombia will reap the greatest rewards are expected to be: paints, textiles, pharmaceuticals, automobiles, car parts and toys.
The Colombian Post |Pedro Bernal