HomeArchiveRegion’s Trade Talks With EU Sour Over Milk

Region’s Trade Talks With EU Sour Over Milk

Free trade talks between Central America and the European Union (EU) resumed Thursday in Madrid, Spain, after stalling last week in Guatemala over the issue of cheese and powdered milk subsidies.

The two sides are skimming close to their original deadline, as the parties had hoped to complete the talks before the May 18 EU-Latin America summit in Madrid. But newly elected Costa Rican President Laura Chinchilla expressed optimism that an agreement would be reached, claiming that only $4 million were needed to seal up negotiations.

“It can’t be possible that (we) lose something so important with only $4 million in play,” Chinchilla said at a press conference Tuesday. “Our commitment to the development of these countries has to be valued at much more than $4 million and that is the reason we are there, making a call to close this negotiation.”

She will travel to Madrid on Sunday to lobby for the completion of the agreement. She admitted that were it not for the association agreement’s urgency, her new responsibilities at home would keep her from attending.

In her first press conference since stepping into the role of the foreign trade minister, Anabel González referred to the trade negotiations as “complex” and said the goals of this week’s talks would focus on finding a fair balance for all parties involved. González said Chinchilla met with El Salvadoran President Mauricio Funes and Spanish President José Luis Rodríguez Zapatero to “discuss the importance of the agreement for the countries of Central America.”

“(Chinchilla) met with Zapatero (Monday) to reiterate the importance of creating a balanced agreement,” González said. “We are trying to reach a fair agreement that suits the interests of Costa Ricans, as well as the other countries in our region.”

Talks curdled last week when the parties could not come to an agreement regarding trade and subsidies on powdered milk and cheese. According to former foreign trade minister Marco Vinicio Ruíz, European heavily subsidizes its dairy industry, making it nearly impossible for Central American producers to compete.

“We can’t have free trade where there’s a subsidy of this magnitude,” Ruíz told The Tico Times last week. “Under current circumstances, it’s totally impossible for us to close (the deal). We hope (Europe has) reflected on this and that they are coming with an alternative that is of more interest to us” (TT, May 4).

However, according to Tomás Pozuelo, president of the Food Industry Chamber (CACIA), Costa Rica should be faulted for creating the roadblock in negotiations. “Costa Rica is really the only country in the region that produces and exports powdered milk,” Pozuelo told The Tico Times. “Central America imports most of their powdered milk from countries that only have a 15 percent tariff. Costa Rica has a 65 percent tariff in its distribution of powdered milk, which makes it the most expensive country in the region.”

Pozuelo explained that the high tariff on Costa Rican powdered milk was used to “protect and benefit Dos Pinos,” the giant national dairy cooperative. According to Pozuelo, Dos Pinos receives a 65 percent national subsidy for its production of powdered milk. If the trade agreement passes, Dos Pinos’ subsidy would be reduced to the rate established in the agreement.

“If the agreement passes it will hurt Dos Pinos but benefit everyone else,” Pozuelo said. “Not everybody wins in free-trade agreements. If powdered milk is included in the agreement, it will benefit everybody in the region. If it is not, it will benefit a very small number of producers.”

The Tico Times sought a response from Dos Pinos, but the company’s spokesperson for this issue was out of the country.

Over the course of the past year, negotiations have been stalled by the coup in Honduras, then over quotas on textiles and banana tariffs, and now by milk.

Trending Now

Remote Osa Eco-Lodge Playa Cativo Joins Small Luxury Hotels of the World

Playa Cativo Lodge, a secluded beachfront retreat on the Golfo Dulce in Costa Rica's Southern Zone, has been admitted into Small Luxury Hotels of...

Costa Rica Hotel Is the Only New Three-Key Michelin Stay in the Americas

A luxury resort on Guanacaste's Papagayo Peninsula has received the Michelin Guide's highest hotel distinction, making it the only property in the Americas to...

Costa Rica’s Former Simón Bolívar Zoo Opens for Coffee Day

San José residents will get another chance to walk the grounds of the former Simón Bolívar Zoo on Saturday, October 3, when the site...

Costa Rica Pilot Faces Discipline After Aviation Safety Criticism

Costa Rican police pilot David Damazzio Fernández faces possible suspension or dismissal over media comments about aviation safety oversight and criticism posted on social media.

Pura Vida: Past the Point of No Return

Growing up on the Lower East Side of New York certainly didn’t prepare me for the culture shock of moving to a sleepy little...

Panama repeats China invitation to Canal Neutrality Treaty

Panama’s government again asked the People’s Republic of China to accede to the protocol of the Treaty Concerning the Permanent Neutrality and Operation of...

Costa Rica Data Center Proposal Draws Water Concerns

Residents protested a possible data center in Bagaces on Saturday, raising concerns about water use and demanding more information, while the mayor said no...

Costa Rica Population Could Begin Shrinking Earlier Than Expected

Costa Rica's population could begin shrinking earlier than previously expected as the number of children being born continues to fall faster than population experts...

Human Trafficking Cases Reach 16-Year High in Costa Rica

Costa Rica recorded 83 human trafficking victims in 2025, the highest number reported in any single year since at least 2010, according to figures...
🌴 The Weekly Pura Vida

Costa Rica, Once a Week

The week's top stories, weather & insider tips — delivered every Sunday. One email, zero clutter.

🔒 Free. No spam. Unsubscribe anytime.

Loading…

Latest News from Costa Rica

Costa Rica Coffee Maker Chorreador
Costa Rica Car Rentals
Costa Rica Travel Insurance
Costa Rica Travel