Costa Rica Coffee Guide

President Cautious About Free-Trade Pact Proposals

August 20, 2004

PRESIDENT Abel Pacheco this weeksaid he is cautious about negotiating newfree-trade agreements.He made the announcement earlier inthe week after receiving requests to negotiatefree-trade agreements with Taiwan andthe countries of the Common Market of theSouth (MERCOSUR) – Argentina, Brazil,Paraguay and Uruguay – while in theDominican Republic to attend the inaugurationof President Leonel Fernández and aspecial presidents’ summit.During a meeting with TaiwanesePrime Minister Yu Shyi-Kun, Pachecoexplained that for Costa Rica, this is notthe ideal time to enter new trade negotiations.“It seems the world is moving in thatdirection, that’s why I’m not saying no,”Pacheco said. “Everything in its due time.Right now, we are dealing with the free tradeagreements signed with the English speakingcountries of the Caribbean andthe United States. We can’t work on afree-trade agreement at this time. Perhapsin the future.”In March, Costa Rica and 14 membersof the Caribbean Community (CARICOM)signed a bilateral trade deal (TT,March 12). In late June it was submittedto the Legislative Assembly for ratification(TT, July 2).On May 28, top trade officials fromCosta Rica, El Salvador, HondurasGuatemala, Nicaragua and the UnitedStates signed the Central American Free-Trade Agreement with the United States(CAFTA) (TT, May 28). CAFTA wassigned for a second time on Aug. 3 toinclude Dominican Republic (TT, Aug. 6).CAFTA has yet to be submitted to theLegislative Assembly. In recent weeks,President Pacheco has said he would conditionthe submission of CAFTA to theassembly on the approval of the much delayedPermanent Fiscal Reform Package.Pacheco also was cautious whenresponding to Brazilian President LuizInácio Lula da Silva after he presentedMERCOSUR’s proposal.From now on, Pacheco said, all proposalsaimed at opening markets will besent directly to the President’s economiccouncil and the Foreign Trade Ministry(COMEX).While in Dominican Republic,Pacheco also met with Chang-Hyun Cho,President of South Korea, who asked forCosta Rica’s support in South Korea’s bidto have one of its countrymen elected toone of the non-permanent seats of theUnited Nations Security Council for the2007-2008 term.Korea also offered to give Costa Ricaa $28 million low-interest loan to improvethe country’s Internet infrastructure.The daily La Nación reported that Koreanofficials conditioned the loan on CostaRica’s support for the Security Councilnomination.

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