The Minister of Foreign Trade of Ecuador, Juan Carlos Cassineli, confirmed that Ecuador was going to sign a free trade agreement with the European Union (EU) on November 11. In 2007 Ecuador radically opposed any kind of TLC, but the need to improve foreign trade drove the country to resume negotiations with the EU in 2014.
"Right now, our fruit is more expensive than the fruit coming from other countries; therefore, the signing of this agreement will allow us to access this market and be competitive. The last few years we have concentrated on other markets with lower barriers or tariffs where we can enter our products at affordable prices for consumers. Under this agreement we would be competing almost on a par with the bananas from Peru, Central America, or Colombia. No market is easy, as they can have economic, geopolitical, or currency devaluation problems; we'll accept this new challenge," says Katherine Ubilla, of Ecuasabor.
According to reports, the agreement will be based on the FTAs the EU has with Colombia and Peru. However, after years of negotiations, Ecuador managed to soften some terms in their favor, achieving terms that are more suited to the country's development plans because, according to the minister, Ecuador is "a dollarized country that is less developed than its Andean partners."
EU potential for Ecuador
The EU is made up of 28 countries, including several world economic powers, and it is the second largest economy in the world. In 2015, Ecuador exported 2,776 million dollars to EU destinations, while the group of countries had imports for more than 5,000 million dollars. This shows the growth potential that the signing of this agreement could have for Ecuadorian exports.
"This market has a great potential for us. Our highest production period begins in January, so if this FTA is a reality, we will have the capacity to supply this market. We still have a long way to go because other countries are ahead of us, as producers we are confident that the quality of our bananas will allow us to get a share of the market," Ubilla stated.
Ecuador expects this agreement will allow it to have better access to technologies, be attractive to investors, and to export manufactured products with added value.
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