Ecuadorian Fruit Preferential Access to China Put on Pause

On May 11, Ecuador and China officially signed a free trade agreement that aims to boost bilateral trade, including that in the agricultural sector. The deal was signed by Ecuador’s Minister of Production, Foreign Trade, Investment and Fisheries Julio José Prado and China’s Minister of Commerce Wang Wentao during a video conference after a year of negotiations. The consultations for the China–Ecuador FTA began in February 2022 and ended in February of this year, demonstrating remarkable efficiency driven by a mutual willingness to unlock trade potential.

To have the agreement enter into force, however, the two countries must go through their respective domestic procedures. In Ecuador, the FTA must be approved by the National Assembly and Constitutional Court. Unfortunately, in light of the recent dissolution of the National Assembly caused by Ecuador’s current political crisis, the agreement ratification process has now been put on hold. Elections for new assembly members are tentatively scheduled for August, following which the newly formed parliament will resume the FTA ratification process.

The agreement will allow 99.6% of Ecuador’s exports to enter the Chinese market without tariffs or barriers, while 828 Ecuadorian products were excluded from the list in order to safeguard local manufacturing.

With regard to the agricultural sector, the preferential access was granted to Ecuador’s most traded products, including shrimp, bananas, cut flowers, cocoa and coffee.

“What we have signed opens up a market of 1.4 billion consumers. Nearly 50% of Ecuador’s exportable supply will enter immediately when the agreement is in force, and the rest will have a 5-to-20-year phase-out period,” Prado specified. Aside from plantains, which were granted a 0% tariff in the first year, the 25% tariff on other bananas will be gradually reduced until it is entirely waived in 20 years. The 25% tariff on dragon fruit and mangos will be eliminated in five years, while the 20% tariff on cut flowers will be removed in 20 years, according to the agreement.

Ecuador has become China’s 27th FTA partner globally and its fourth in Latin America, following Chile, Peru and Costa Rica.

Image: Pixabay

This article was based on a Chinese article. Read the original article.