Costa Rica Coffee Guide

First Round of E.U. Talks Conclude

November 2, 2007

The first round of negotiations over an association agreement between the European Union and Central America ended with some parameters set and some cash promised for Costa Rican projects.

Toward the end of the negotiations, the European Union announced aid to Costa Rica of about $48.7 million. The money is to be spread out over the next six years to promote social development and regional integration.

The amount was fixed Oct. 25 in an accord signed by Costa Rica’s acting Foreign Minister Edgar Ugalde and Joao Aguiar, deputy director general for external relations at the European Commission and leader of the E.U. side of the negotiation table.

“There’s no doubt that Costa Rica is the Central American country with which the European Union has most in common,” Aguiar said.

About $36.5 million of the grant will go toward reducing poverty and inequality through investments in health care, education, employment programs and the environment, Aguiar said.

The remaining $12.2 million will help Costa Rica integrate into the Central American Customs Union while still remaining competitive. Aguiar said the European Union would review the fruits of its donation in 2010.

Costa Rica is receiving less money from the European Union than any of its regional neighbors. During the same period, 2007-2013, the European Union will donate $54.4 million to Panama, $173.3 million to El Salvador, $193.4 million to Guatemala, $210.6 million to Honduras and $306.5 million to Nicaragua.

Aguiar said the donations reflected the varying needs for aid.

“The fact that Costa Rica is receiving less is not a reason to be sad,” he said. “It’s a reason to be glad.”

Negotiators hit a small rough spot toward the end of the meetings when the Europeans declared they want to negotiate starting with World Trade Organization (WTO) standards as the baseline, rather than the trade preferences Central America is granted under the Generalised System of Preferences (GSP) Plus program.

Aguiar defended the position saying it is the only legal option the European Union has.

“Does that mean that current tariffs are going to have to go up? No. One thing is the contractual legal mechanism, another what the European Union applies today and what it intends to keep applying, GSP Plus,” Aguiar said, according to daily La República.

Head negotiator for Central America, Costa Rican Roberto Echandi, for his part, commented that the end point is more important than the start point.

The next round of talks will take place in Brussels this February. Negotiators decided to change the date from December to give time for both sides to exchange more detailed information in preparation for the negotiations.

 

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