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EU-Central America

The European Union has been negotiating a free trade agreement with six Central American countries — Guatemala, El Salvador, Honduras, Nicaragua, Costa Rica and Panama — since mid-2007. The draft negotiating plan from the EU’s side is available here.

The background logic to this is clear. As soon as the US signed NAFTA, the EU followed suit and made its own bilateral trade agreement with Mexico. Now that the US has signed CAFTA, here comes an EU deal for the same countries (minus the Dominican Republic, which is part of the ACP grouping that the EU is already negotiating an EPA with under the Cotonou Agreement).

The deal is dubbed an “Association Agreement” in which the FTA is one component alongside others (concerning cooperation and political dialogue). It is also a “progressive” agreement in that its provisions are phased in over time.

But analysts concur that such association agreements are even worse than FTAs: “The agreements are notable for their broad scope and their ‘open’ and ‘ongoing’ nature; in other words, they oblige the signatory countries in years to come periodically to extend the agreement and to undertake an undefined number of judicial, administrative, economic and social reforms, the aim of which is to provide ever more favourable investment conditions for European companies. As they accumulate, the changes will amount to constitutional reforms, which will be decided at ministerial level, far from the eyes of Parliaments and public opinion in the countries concerned.”

The social movements of Latin America have made their position clear: “The Association Agreement is nothing more than a continuation of free trade agreements. These texts are a farcical denial of democracy from the word go. Like the DR-CAFTA, the FTAA, and NAFTA, they are all tools used by big capital to exacerbate and deepen the poverty and exploitation of those who produce wealth by their labour. DR-CAFTA has been in force for two years and already we see our countries being inundated with imports, afflicted by rising consumer prices, and starved of tariff revenues, leading to reduced public spending. On top of this, the US has blockaded Central American agricultural products on spurious phytosanitary grounds. Meanwhile, the inhuman deportation of our compatriots continues. The enforcement of the FTAs and the neoliberal model is bolstered by criminalization and repression of indigenous and peasant agendas — particularly, the struggle for Mother Earth — through the enactment of antiterrorism laws. Therefore, we say NO to the negotiation and signing of the Association Agreement between Central America and the European Union: it is contrary to the interests of our peoples.”

In May 2010, the text was agreed to, and in March 2011, the text was initialled. It still needs to be signed, ratified and put into force by all parties: the European Union, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama.

last update: May 2012
Photo: Cacahuate/Wikipedia/CC BY-SA 3.0

Costa Rica denies blocking negotiation with EU
On April 1, Nicaragua withdrew from FTA talks with the EU in Honduras as it failed to gain support of other Central American countries on the fund proposal for regional development, in which it suggested the EU accounts for 90 percent and Central America 10 percent. Nicaragua accused Costa Rica of demanding "in the last moment" to review the proposal.
EU-Central America Association Agreement: Rejection by social movements of EU FTAs
With Nicaragua leaving the negotiation table, the 7th round of negotiations between the EU and Central America has been suspended. With this, the aggressive policies of he EU have been brought to a halt for the time being.
Progress in negotiations of trade agreement between CA and EU
Increased flexibility of the rules of origin, market access, services, dispute resolution, regional approach, competition and procurements are the advances made in the sixth round of negotiations of the Free Association Agreement between the European Union and Central America according to Romulo Caballeros, Minister of Economy of Guatemala.
Eurochambres favours EU-Central America association agreement
Speaking at the EU-Central America Private Sector Forum, in Brussels on 28 January, Eurochambres’ Secretary-General Arnaldo Abruzzini urged political leaders not to miss the favourable momentum to conclude an association agreement (AA) between the EU and Central America, to the benefit of businesses in both regions.
European Union and Central America for Partnership in 2009
The European Union (EU) and Central America started on Monday the sixth round of negotiations for a Economic Partnership Agreement (EPA) with the commitment to speed up the process so that it can be signed in 2009.
EU and Central America pursue negotiations for an Association Agreement
The European Commission and Central America — Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua; and Panama as observer — will meet in Brussels from 26 to 30 January 2009 for the sixth round of negotiations leading to an Association Agreement between the two regions. In addition, the Commission is announcing a €15 million aid package to support the strengthening of regional institutions in Central America and the participation of civil society in the process.
EU trade agreement with Central America may force ACP countries out of banana business
The banana companies in African, Caribbean and Pacific (ACP) States maybe forced out of business following the European Union’s decision to negotiate a Free Trade agreement (FTA) with Central American countries in what the ACP Group describes as on “too generous” terms.
EU free trade agreement with Central America to include ethanol
The European Commission has offered to permanently scrap import duties on ethanol from Central America as part of ongoing discussions over an Association Agreement between the two regions.
Central America: Commission holds fourth round of negotiations for an Association Agreement
The European Commission, negotiating on behalf of the European Union, and Central America will meet in Brussels from 14 to 18 July 2008 for a fourth round of negotiations in view of an Association Agreement between the two regions.
Costa Rica: EU not interested in free-trade agreement
Costa Rican officials announced they are not satisfied with the market opening proposal issued by the European Union (EU) prior to the beginning of the fourth round of negotiations for an eventual EU-Central America agreement. Costa Rican trade officials stated that they “do not perceive an interest on the part of the Europeans to advance the process.”