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US commends Nicaragua’s trade liberalization

Nicaragua Dispatch

US commends Nicaragua’s trade liberalization

Nicaragua’s leading trade partner commends the Sandinista government for efforts to promote free trade and economic integration over the past six years

By Tim Rogers / Nicaragua Dispatch

18 December 2012

The U.S. government is commending Nicaragua for its continued trade liberalization and integration into the global economy under the Sandinista government of President Daniel Ortega.

During a statement delivered earlier this month in Geneva, Switzerland during the World Trade Organization’s policy review of Nicaragua, Deputy U.S. Trade Representative Michael Punke noted that Nicaragua has continued to make solid advances to promote free trade and economic integration since its last review in 2006, a year before Ortega returned to power.

“Much has happened since Nicaragua’s last review in 2006, as the government has continued to promote access to foreign markets and has sought to enhance Nicaragua’s integration into the global economy. The United States commends Nicaragua on the direction of its trade liberalization strategy, as Nicaragua continues to pursue greater integration in the global economy by opening markets, stimulating domestic production and promoting national efficiency, diversification, and competitiveness,” Punke said.

The U.S. trade official noted that the U.S-Central American Free-Trade Agreement (CAFTA-DR) has doubled bilateral trade between the United States and Nicaragua since 2006.

“The impact of CAFTA-DR on our bilateral trade flows is evident and has remained strong despite the impact of the global financial crisis in 2008 and 2009,” Punke noted. “Between 2005 (pre-CAFTA-DR) and 2011, U.S. and Nicaragua total two-way trade in goods more than doubled, from over $1.8 billion to nearly $3.7 billion. The United States imported a total of $2.6 billion from Nicaragua in 2011, an increase of 29.7% from 2010. U.S. goods export to Nicaragua totaled $1.1 billion, an increase of 7.8% from 2010.”

Nicaragua also received good marks for promoting trade diversification with other countries and regional economic blocs.

“Nicaragua also has trade agreements with Mexico, the Dominican Republic, Chinese Taipei, Panama, and has concluded trade negotiations with Chile,” Punke said. “Nicaragua and its Central American partners have completed negotiations of an Association Agreement with the European Union, and Nicaragua is intensifying its trade relations with a number of other countries through the Bolivarian Alliance for the People of our America (ALBA).”

Punke also noted progress made in Nicaragua’s domestic trade regime, parts of which were modified in accordance with commitments made under CAFTA. “We further commend Nicaragua for the progress it has made in the customs area by implanting a risk assessment system and reducing customs clearance times over the review period,” the U.S. official said.

Nicaragua’s leading trade partner also noted a few issues that it would like to see Nicaragua improve upon, including governance issues such as strengthening the rule of law and “predictable, transparent and non-discriminatory application of measures.”

“While we note the improvement in custom clearance times, we agree with the (WTO) Secretariat’s assessment that further improvements could be made to streamline customs formalities, for example, by reducing the number of physical inspections and cutting clearance times further.”

Punke concluded his statement at the WTO meetings in Geneva by saying, “We continue to value our close work with the Government of Nicaragua – both bilaterally and in the WTO.”