At the beginning of negotiations with the Office of the United States Commercial Representative (USTR, in English), the process would be led by Andrea Malito, senior director for Central America and the Dominican Republic of that entity. The objective is to restore preferential treatment within the Free Trade Agreement (TLC), but the possible modernization of the agreement was also addressed.
Although the validity of the tariffs approved during the government of President Donald Trump continues under legal dispute in the US., Guatemala will follow its road map so that, if the Courts confirm its application, negotiation is continued with the US authorities, in order to reduce or eliminate the 10% tariff that applies to Guatemalan products. For now, that rate remains in force.
After the mission of the Guatemalan Public-Private Delegation that held three days of meetings in Washington DC with the USTR, the State, Commerce and Agriculture departments, as well as with business chambers, the national entities expressed their conclusions.
A prominent coincidence is that Guatemala is considered key to the US, not only commercially. It seeks to restore preferential treatment, although non -tariff commercial barriers indicated by the USTR persist. Some may immediately be resolved, while others will require legislative reforms.
Mineco
The Ministry of Economy considers that the bilateral relationship was strengthened, reiterating that Guatemala is a valuable commercial ally, perception that, according to the portfolio, was confirmed in the meetings. The US recognized the commitment of the government of President Bernardo Arévalo with democracy, the fight against corruption and infrastructure development.
Last week the Mineco explained that the USTr told them that in two weeks (as of May 27 when it was the first meeting) they would send the country a proposal of framework to negotiate. Meanwhile, on Monday, June 2, the President of the Republic, Bernardo Arévalo, said in a press conference that the US government promised to give an answer within 60 days.
Regarding the conclusions, the Ministry clarified, however, that the elimination of the 10% tariff is a sovereign decision of the USA. The effort to improve key infrastructure such as ports and airports, backed by recent agreements, among them, with the US body of US Engineers, was also highlighted.
As for the recommendations received, the identification of areas of mutual cooperation was mentioned, with emphasis on strengthening the commercial relationship and support for sustainable development. The need to advance in democratic consolidation, transparency and improvement of strategic infrastructure was stressed.
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On the viability of eliminating or reducing the tariff and if the measure would be general or specific by product, the Mineco said that the decision falls completely in the US. Guatemala, they reiterated, remains committed to strengthening commercial relations.
Agexport
Francisco Ralda, president of the Guatemalan Association of Exporters (AGEXPORT), said that Guatemala has taken a strategic step in his economic relationship with the US.
The tour, he explained, was not to negotiate specific products or sectors, but the beginning of a medium -term national agenda. For sectors such as agricultural, costumes and textiles, there is interest and openness of US institutions. Ralda pointed out important exchanges with Otexa and other associations of the branch.
It was recommended to maintain a technical posture, unified and backed by evidence. The USTR positively valued the technical report of the Government of Guatemala and the support letters of US companies in the country.
Ralda confirmed that a proposal of framework to negotiate will be sent from the United States and that the process will be led by Andrea Malito, senior director for Central America and the Dominican Republic of USTT. He added that, although there were no specific requests per sector, the need to modernize CAFTA-DR was raised. It considers that any tariff reduction be analyzed by case, and not in a generalized way.
Cacif
The president of Cacif, Charles Bland, agreed that the US valued Guatemala’s progress, although he stressed that the dialogue just begins and that there is no certainty about an eventual tariff reduction and reiterated that this decision corresponds to President Trump.
The importance of coordination between the public and private sector was highlighted. “The message that we go together is important and powerful; and the United States reiterated several times that you see it with good eyes,” said Bland.
He indicated that the process is barely initiated and is expected that in two weeks the Guatemalan authorities will be given a proposal of framework to negotiate, with the aim of recovering the conditions prior to the imposition of the tariffs.
Regarding US recommendations, Bland mentioned that the authorities of that country mentioned the list with eight non -tariff commercial barriers identified by the USTR. Guatemala, presented advances and a road map to serve them and congratulated the country for progress in areas linked to the Mineco and the Ministry of Health.
However, there are issues that can be resolved in weeks but others will require legislative reforms, Bland warned. As for the possibility of eliminating the tariff, he considered premature to give an opinion because he would be speculating, but expressed “we hope to return to zero, which would be positive for the region and for Guatemala, since it would bring investment and development and help reduce migration.”
Camagro
The Chamber of Agro (Camagro) agreed that Guatemala remains a strategic partner of the United States, not only commercially, but also in areas such as security, migration and investment. The trade is bidirectional, and Guatemalan agricultural products hold supply chains that also benefit the US, the entity added.
Carla Caballeros, executive director of this Chamber, said that there is a clear expectation that Guatemala improves its regulatory framework and facilitates trade, in addition the United States authorities valued the support of the private sector to the government and the presentation of an action plan or route map before the USTT.
He emphasized to maintain the coordinated work between sectors to fulfill the commitments assumed. Guatemala is a political priority for the United States, he said, for affinity in democratic values, the reception of deportees and the joint struggle against organized crime.
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Caballeros expressed optimism about eventual elimination of the tariff: “There is a real possibility of restoring preferential access, especially if Guatemala demonstrates commitment to the reforms raised.”
Fundesa
After a series of meetings with both public, private institutions as well as research centers “there is a clarity that countries such as Guatemala that have no commercial deficits with the United States and that are commercial allies, should not have tariffs,” said Juan Carlos Zapata, executive director of the Foundation for the Development of Guatemala (Fundesa). However, he said that it is knowledge that these decisions are a public policy issue of the United States government.
Therefore, the conversations with the USTR will be working to deepen to try to reach a satisfactory agreement for both countries that allow these tariffs to be eliminated. Although he recalled that the new tariffs are ventilating in the courts of that country.
In the short -term steps, the Mineco will continue to talk with the USTR, in the next two weeks (as of May 27), in order to have greater clarity of the following steps and how to get to an agreement so that the tariffs are eliminated.
Once the monitoring instructions are received, surely an agreement can be reached that allows to reestablish trade without tariffs, as established by DR-CAFTA, Zapata added.