The Deputy Minister of Integration and Foreign Trade, of the Ministry of Economy, Héctor Marroquín commented that the United States and Guatemala already give an equal treatment of free access of products, but shows that there is uncertainty due to measures that this country is looking to implement.
Asked if there is the possibility of changing these conditions despite the Free Trade Agreement (FTA or DR-CAFTA), he replied that, despite the current equal treatment, they can change when taking into account that United States authorities announced the review of all commercial agreements. Another doubt is the possible implementation of reciprocal measures for the existence of certain internal taxes, aspects that it develops in an interview with Free press.
Apart from steel and aluminum tariffs, for other imports made by the United States of Guatemalan products, new tariffs have already entered into force?
The government of that country is making two types of decisions. One is of general application, that is, all those who are interested in exporting there are subject to these measures, and the other is that for specific cases such as Mexico, Canada, China and others, there are ads with particular provisions.
At the moment the only generalized disposition is the increase in the tariff for steel and aluminum (to 25%), which is already applied since March 12.
Recall that they are not negotiated conditions or rules, but that they are unilateral decisions that in their sovereign right as a country can take them.
In which phase are the provisions announced by that country to establish reciprocal measures and tariffs, as well as tariffs for agricultural products?
At the moment, the conditions for the access of Guatemalan products have not changed, derived from the fact that we no longer have tariffs in our bilateral exchange, those conditions, which were the ones we negotiated in DR-CAFTA, have not changed.
Is there the possibility of changing these conditions even though there is FTA?
Yes, and I can say that according to the announcement made by the United States authorities that, all the commercial agreements that the country has signed and is in force were going to be reviewed.
Under the conditions negotiated in the DR-CAFTA, in Guatemala and the United States we already have an equal treatment of free access on both ways.
However, as announced according to the Reciprocal and Just Commerce Law, that country will seek reciprocity criteria to equate their situation when they consider that there is a disadvantage in a market.
Some sectors believe that if they put tariffs on the importation of Guatemala products, it will be a unilateral measure that would affect the FTA and that there could be a demand or leave without validity some aspects of the treaty What do you think?
In practical terms if any of the parties, whether the United States or the rest of the countries that we are part of that treaty, take a unilateral measure, we are breaking the treaty, which, from our perspective, has happened with which they have the United States and Canada.
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However, we are very positive because in Guatemala’s relationship with the United States several criteria are fulfilled, one of these is the reciprocity, that is, there are no tariffs, the other is that of commercial balance since it is not deficit for the United States.
In the case of reciprocity measures, it is mentioned that they could also review the internal taxes of the countries, subsidies or other charges that affect US products, would it have any involvement in the case of Guatemala?
There has been no more information about that. At the time we identify internal taxes that we have for some specific merchandise such as the tax on the distribution of cement, oil and its derivatives such as gasoline, beers, liquors, soda and energy drinks, as well as tobacco.
We still do not have enough information to determine how those products that have a specific tax would be. The first results of the analysis for reciprocal measures are expected in April.
I consider that they know what the situation of internal taxes in Guatemala is because at the time, when the DR-CAFTA was negotiated it was part of the information that the country presented regarding the universe of goods, and from there the treaty was negotiated.
It is also very important to know that, in terms of commercial agreements, internal taxes have never been negotiated because that remains within the power that each State has to be able to put the taxes it deems for some goods.
The issue of agricultural tariffs announced how do you advance?
We will also have to expect what they specify on April 2, and from there we can already enter to analyze with more relevance and to determine what we would do.
Our economies are complementary, Guatemala attends in some windows during the year based on the cultivation cycles that are already here for the cycles for US production that fails to fill the demand for those products.
Agro is a very important sector, not only for the economic part, but because of the social effect it has, because we are talking that many producers who cultivate for export are small, there is a concern on our part, but there is not enough information to determine what the effect would be.
What has to be done then?
We have to continue waiting, I understand that this can be a slightly difficult response to assimilate, but we do not have all the pieces of the puzzle, and until we have them, we cannot really make a decision of how the state of Guatemala can act, guaranteeing that its exports are not affected or that the affectation is the least possible.
At this time we are not considering imposing measures to the United States, because they have not imposed us on us, we continue under a free trade scheme and we hope and we are positive that it will be maintained.
Analysts and former officials believe that the Government, through Minex or Mineco, must make approaches or lobby with US authorities to have an idea of what they are going to focus on for Guatemala, have you been carried out?
We are in coordination with Minex officials who are at the Embassy in Washington, they are making approaches with the authorities. It may not be the best moment, because not all officials of the new United States government have been confirmed by their Congress.
We understand that a lot of uncertainty is generated and the actions and many statements are disturbed, but there are approach and search for more information to finish understanding what the situation is and making the best decisions.
It is not an activity that is being done so far, the embassy works permanently to maintain communication channels with the officials of the Department of Commerce, the Office of the United States Commerce Representative (USTR), with the State Department.
What recommends entrepreneurs with this scenario of uncertainty?
At this time we must all stay informed, and try not to anticipate, maintain an attitude of calm, the real conditions have not changed and at the time there is a change, we have to analyze what the affectation or impact is and depending on that to make the corresponding decisions.