logo logo

Taiwan signs FTA with Guatemala, eyeing more exports to US market

Friday September 23, 2005

Taiwan signs FTA with Guatemala, eyeing more exports to U.S. market

(Kyodo) - Taiwan President Chen Shui-bian signed a free trade agreement with his Guatemalan counterpart Oscar Berger in Guatemala City on Thursday in a bid to use the Central American country as a gateway for more exports to the North American market.

"The FTA will boost Taiwan’s investment in Guatemala," the two countries said in a joint statement, seeing Guatemala as a strategic production point for Taiwan.

The statement cited the new accord as well as a free trade agreement signed in 2004 by the United States, five Central American countries — Guatemala, El Salvador, Nicaragua, Honduras, Costa Rica — and the Dominican Republic as a "double stimulus" for Taiwan’s exports to the U.S. market.

In the meantime, Guatemala expects investment by Taiwan to result in more employment and better technologies in the country. It also hopes to narrow a big trade gap between the two countries under preferential tariffs, which are expected to accelerate exports of Guatemala’s sugar, coffee and wood to the Taiwanese market.

In 2004, Taiwan’s exports to Guatemala totaled $87 million, about 50 percent of which were vehicles and electronics, while Guatemala exported only $2 million worth of goods to Taiwan, more than 90 percent of which was sugar.

Guatemala is the second country to sign a free trade pact with Taiwan, following the first one with Panama in 2003, and one of the 26 countries recognizing Taiwan’s government.

Mainland China claims sovereignty over Taiwan, warning that it should not establish official diplomatic relations with other countries.

Chen is on a 12-day tour of Central American and Caribbean countries, accompanied by a delegation consisting of government officials and business leaders.

He is expected to attend a regional summit meeting in Nicaragua next Monday after visiting the Dominican Republic on Friday.

 source: Kyodo