REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL Annual Report on the Implementation of Part IV of the Agreement establishing an Association between the European Union and its Member States, on the one hand, and Central America on the other
Date: 2016-02-18
Institutions: Directorate-General for Trade and Economic Security, European Commission
Subjects: Central America, activity report, association agreement (EU), liberalisation of trade, sustainable development, tariff preference, tariff quota, trade cooperation, trade relations, trade statistics

EUROPEAN 
COMMISSION 

Brussels, 18.2.2016  
COM(2016) 73 final 

REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND 
THE COUNCIL 

Annual Report on the Implementation of Part IV of the Agreement establishing an 
Association between the European Union and its Member States, on the one hand, and 
Central America on the other 

EN 

   EN 

 
 
 
 
  
 
REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND 
THE COUNCIL 

Annual Report on the Implementation of Part IV of the Agreement establishing an 
Association between the European Union and its Member States, on the one hand, and 
Central America on the other 

1. 

Introduction 

In  2015,  the  Part  IV  of  the  EU-Central  America  Association  Agreement  establishing  an 
Association between the European Union and its Member States, on the one hand, and Central 
America  on  the  other  (hereinafter,  “the  Agreement”)  covering  Trade  entered  into  its  second 
year of implementation1. In accordance with Article 13 of the Regulation (EU) No 20/2013 of 
the  European  Parliament  and  of  the  Council  of  15  January  2013  implementing  the  bilateral 
safeguard  clause  and  the  stabilisation  mechanism  for  bananas  of  the  Agreement  establishing 
an  Association  between  the  European  Union  and  its  Member  States,  on  the  one  hand,  and 
Central America on the other2 (hereinafter, “the Regulation”), the Commission should present 
an annual report to the European Parliament and the Council. This report responds to this is 
requirement and structured as follows:  

•  A summary of the statistics and an overall assessment of trade flows (Section 2 of this 

report); 
Information  on  the  activities  of  the  various  bodies  responsible  for  monitoring  the 
implementation  of  the  Agreement  (Section  3),  including  on  fulfilment  of  obligations 
under the Title on Trade and Sustainable Development (Section 4); 
Information on the monitoring activities referred to in the Regulation (Section 5). 

• 

• 

2. 

OVERALL ASSESSMENT: EVOLUTION OF TRADE 

2.1.  Methodology 
As  indicated  in  the  previous  report  on  the  implementation  of  the  Agreement3,  EUROSTAT 
and  Central  American  statistics  show  significant  divergences.  EU  statistics  usually 
significantly  exceed  Panamanian  statistics  as  regards  EU  exports  to  Panama,  but  remains 
significantly below Costa Rican statistics as regards EU imports from Costa Rica, whereas in 
the other countries of the region the divergences remain reasonable. These patterns have been 
discussed in the context of the Market Access Sub-committee established by the Agreement.  
It appears that, given the importance of the Free Trade Zone of Panama, which is amongst the 
biggest in the world, a significant fraction of trade flows declared as being exported to Panama 
does  not  enter  "in  fine"  the  Panamanian  market  but  is  re-exported  to  other  Latin  American 
countries.  

Seen  this  situation,  it  has  been  agreed  with  Central  America  to  exchange  trade  data  on  an 
annual basis and to carry out a joint analysis based on the respective import statistics which 
tend to be considered more reliable than export statistics.  

1  
2  
3  

OJ L 346, 15.12.2012, p. 3. 
OJ L 17, 19.1.2013, p. 13. 
COM (2015) 131 

2 

 
 
 
                                                            
In the following analysis, trade flows are described on the basis of the approach agreed with 
Central America: EU imports are estimated on the basis of EUROSTAT data extracted in May 
2015  whereas  EU  exports  to  Central  America  are  based  on  Central  American  statistics 
available  on  the  same  date.  These  latter  data  being  expressed  in  US  dollars,  these  statistics 
have been converted into Euros by applying the annual exchange rate used by EUROSTAT4. 

It should be recalled that the observed changes in trade flows cannot be attributed solely to the 
implementation of the Agreement, as many other factors also influence these figures.   

2.2. 

Evolution of overall trade flows with Central America (goods) 

According  to  the  statistics  published  by  the  Secretariat  for  Central  American  Economic 
Integration  (SIECA),  trade  flows  between  Central  American  countries  and  the  rest  of  the 
world increased by 1,4% between 2013 and 2014. Inversely, for the same period, according to 
EUROSTAT, global EU trade flows contracted by 2.3% between 2013 and 2014. Despite this 
overall decline in trade flows and, while it is not possible to draw any definitive conclusions 
from  this,  there  has  been  an  upward  trend  in  trade  flows  for  certain  countries  and  specific 
goods.  

The trade flow between EU and Central America has increased by 1.2% to EUR 10.5 billion. 
The  EU's  trade  balance  with  Central  America  presents  a  deficit  which  decreased  but  still 
amounted to EUR 1.7 billion in 2014 (the year before the deficit was EUR 2.2 billion).   

Country   

Export 

Import 

Total flow 

Costa Rica 
Guatemala 
Honduras 
Nicaragua 
Panama 

El Salvador 

1,065 
976 
470 
246 
1,180 

6.7%
6.8%
35.0%
3.5%
8.3%

3,771
674
834
284
380

-5.8%
10.5%
14.8%
1.6%
-15.5%

4,836 
1,650 
1,305 
530 
1,561 

-3.3% 
8.3% 
21.3% 
2.5% 
1.3% 

465 

-10.3%

167

-20.9%

632 

-13.4% 

TOTAL 

4,402 

1.2% 
Trade flow between EU and Central America and its yearly evolution  
(in m Euros – year 2014)  

-2.7% 10,513 

6,110

7.2%

EU  exports  to  Central  America  increased  by  7.2%  whereas  the  EU  imports  from  Central 
America decreased by 2.7%. This adverse evolution is linked to two major challenges faced by 
Central America:  

(1) The strong decrease in coffee imports is due to the severe drought and to the coffee 
rust  epidemic  (so-called  “roya”  in  Spanish).  This  decrease  already  impacted  Central 
American  countries  in  2014.  EU  imports  of  Central  American  Coffee  (HS  0901) 
dropped from EUR 1.1 billion in 2012 to EUR 0.7 billion in 2014. This impact already 
materialized in 2014 throughout the region.  

4 The EUR/USD average exchange rates were 1.2848 in 2012, 1.3281 in 2013 and 1.3285 in 2014. 

3 

 
 
 
                                                            
In 2014, El Salvador is the Central American country where coffee exports to the EU 
dropped the most compared to 2013. The import of coffee from this country, which is 
the second most imported product, has fallen further by -61% down to EUR 27 million.  

On  27  May  2015,  the  Commission  has  adopted  a  EUR  15  million  cooperation 
programme  to  help  Central  America  fight  coffee  rust  (a  leaf  disease  caused  by  a 
fungus).  The  objective  of  the  programme  is  to  increase  the  region’s  ability  to  design 
and  implement  policies,  programmes  and  measures  to  help  the  most  vulnerable 
sections of the population living in the coffee production areas of Central America and 
Dominican Republic.  

(2)  The  relocation  to  South  East  Asia  of  the  major  Costa  Rican  exporter  of  IT 
components.  This  heading (HS 8473)  represented 61% of Costa Rican exports to the 
EU  in  2012.  The  effect  started  to  be  noticed  in  2014,  but  given  the  progressive 
relocation  of  this  activity,  it  has  impacted  further  Costa  Rican  exports  in  2014. 
Between  2012  and  2013,  this  heading  decreased  from  EUR  2.6  billion  to  EUR  1.8 
billion, equivalent to a reduction of -19% of EU import from Costa Rica or -12% of 
EU import from Central America as a region. 

Although considerable in absolute terms, these challenges are concentrated on two products as 
the  remaining  EU  imports  from  Central  America  are  extremely  dynamic:  they  increased  by 
11.1% in 2014. 

2012

2013

2014

% 

HS 0901 and 8473 

3,792,829

3,019,885

2,471,355

-18.2% 

Rest 

Total 

2,999,379

3,262,174

3,638,965

6,792,208

6,282,059

6,110,320

11.1% 

-2.7% 

Breakdown of EU imports from Central America and their yearly evolution (in  Euros) 

This  situation  reveals  the  high  dependence  of  Central  American  exports  to  the  EU  on  a  few 
products despite the fact that the number of products exported to the EU increased in 2014 by 
+3%  compared  to  the  year  before,  covering  up  to  2,657  tariff  lines.  However,  the  5  most 
imported  products  still  represent  61%  of  total  EU  imports  from  Central  America.  Those 
products  are,  by  order  of  importance:  electronic  assemblies  of  data  processing  machines, 
coffee, bananas, pineapple and crude palm oil. 

The main destination of EU exports to Central America remains Panama (26%) followed by 
Guatemala  and  Costa  Rica  (24%  and  22%  respectively).  The  main  exports  in  2014  were 
Machinery  and  mechanical  appliance  (27%  of  EU  exports)  followed  by  Electrical  appliance 
and Pharmaceuticals (12.5% each), motor vehicle and articles of steels (10% each). 

Notable positive variations have been recorded in products such as: 

4 

 
 
 
  
 
•  Fish and Crustacean (HS3) imports from Central America have increased by 28% up 
to  EUR  250  million  and  in  particular,    Frozen  shrimp  imports  rose  by  36%  (from 
EUR 124 million up to EUR 169 million), 

•  Fruits and nuts (HS 8) imports have increased by 16% up to EUR 1,4 billion and, in 
particular,  pineapples  imports  rose  by  18%  (from  EUR  456  million  up  to  EUR  537 
million), 

•  Rum in bottle imports rose by 110% (from EUR 8.5 million to 18 million)  

One should note the specific positive trends of the trade flow between the EU and Honduras, 
which  increased  by  21  %  in  2014,  the  highest  increase  in  the  region.    This  dynamism  is 
marked  by  a  strong  increase  of  key  EU  exports  (+35%)  as  well  as  EU  imports  (+14.5%). 
Increase  of    EU  exports  to  Honduras  were  particularly  intense  in  the  following  headings: 
+34%  in  Machinery  and  Mechanical  appliance  (HS84)  up  to  EUR  207  million,  +65%  in 
Electrical  machinery  (HS85)  up  to  EUR  93  million,  +  54%  in  Articles  of  Iron  (HS  73)  and 
+42%  in  Pharmaceutical  products  (HS  30).  Similarly,  increases  of  imports  from  Honduras 
were  significant,  in  particular  in  these  headings:  +64%  in  Vegetable  oil  (HS  15)  up  to  EUR 
113 million, +26% in Fish and Crustaceans (HS 03) up to EUR 50 million, +168% in Sugars 
(HS 17) up to EUR 15 million, +22% in Clothing accessories (HS 61) up to EUR 49 million 
and +71% in Ores and Ash (HS 26) up to EUR 22 million. 

2.3. 

Use of tariff preferences under the Agreement 

The use of the tariff preferences granted by the Agreement can be estimated by assessing the 
fraction of the trade flow which is carried out within the framework of the Agreement. Such 
ratio  requires  detailed  custom  clearance  data.  Central  America  informed  the  EU  that  the 
databases managed by their respective Customs authorities in Central America is not adapted 
for a regular exchange of detailed statistics to analyse the tariff preference, except Costa Rica 
which provided the EU with such data. 

On the basis of the Costa Rican statistics, it appears that 8.8% of the total EU export to Costa 
Rica  (in  value)  is  done  within  the  framework  of  the  Agreement.  This  low  utilisation  rate  is 
due  to  the  long  dismantling  schedule  of  Costa  Rica  and  in  this  early  stage  of  the 
implementation,  therefore  only  a  limited  fraction  of  EU  exports  could  have  an  interest  in 
using  the  preference  offered  by  the  Agreement.  However,  it  should  be  noted  that  the 
utilisation  rate  for  EU  exports  classified  under  the  tariff  lines  which  have  been  fully 
liberalised  by  Costa  Rica  amounts  to  48.4%,  and  this  rate  reaches  even  71%  for  the  EU 
exports classified under tariff lines for which Costa Rica granted a quota to the EU. 

As regards EU imports originating from Central America, 41% of this flow (in value) is done 
within the framework of the Agreement. The rate of utilisation reaches 78% for the imports 
classified under tariff lines for which the EU granted quotas to Central America. These higher 
levels compared to the one for EU exports are due to the asymmetry of the schedules: Given 
the  difference  of  development  between  the  EU  and  Central  America,  the  Agreement  offers 
comparatively  higher  benefits  for  EU  imports  than  EU  exports  until  the  completion  of  the 
liberalisation  schedules  (up  to  10  years  in  general,  but  up  to  15  years  for  a  small  part  of 
products). 

5 

 
 
2.5. 

Use of tariff rate quotas (TRQs) 

The  Agreement  provides  for  several  TRQs  which  consist  of  granting  to  the  other  party  a 
preferential  tariff  treatment  up  to  the  quota’s  quantitative  threshold.  Above  this  threshold, 
imports are subject to the Most-Favoured Nation (MFN) tariff applied. 

The EU has agreed to provide eight TRQs in favour of Central America on products that did 
not have any preferential access to the EU market before the implementation of the Agreement. 
In 2014, TRQs were only used for two categories (cane sugar and rum).  

n
i
g
i
r
O

Central America 

Central America except 
Panama 

Panama 

s
t
c
u
d
o
r
P

Garlic 

Rice 

Manioc 

Bovine meat 

Mushroom 

Sweetcorn 

Sugar 

Rum in container > 2 l 

Rum in container > 2 l 

Sugar 

Nicaragua 

Bovine meat 

t
i
n
U

e
m
u
l
o
v

Q
R
T

t
r
o
p
m

I

U
E

ton 

550 

21,000 

5,000 

9,975 

275 

1,560 

0

0

0

0

0

0

Litre Pure Alcohol 

154,500  141,047

730,000  243,819

105,000 

0

n
o
i
t
a
s
i
l
i
t

U

e
t
a
r

0%

0%

0%

0%

0%

0%

91%

33%

0%

ton 

12,360 

8,548

69%

525 

0

0%

TRQs granted by the EU to Central America – Utilisation in 2014 

In addition to TRQs, the EU also granted to Central America derogation to the rules of origin 
under specific quotas for 118 tariff lines. In 2014, the first full year of application, the use of 
these  derogations  is  almost  negligible  and  the  amounts  imported  under  these  quotas  remain 
very limited and only concern a small fraction of the trade flow that could be eligible for the 
preferential treatment.  

Central  America  granted  TRQs  to  the  EU  on  five  specific  products.  In  2014,  the  EU 
exporters have made use of the opportunities offered by these TRQs, except the one for whey, 
although there is still some margin of growth since the utilisation rate can increase further, as 
indicated in the following table: 

6 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
e
s
a
e
r
c
n
i

l
a
u
n
n
A
45
95
10
150
45

s
t
c
u
d
o
r
P

)
n
t
(

a
t
o
u
Q
945
1,995
110
3,150
945

cured hams 
powdered milk 
Whey 
Cheese 
Prepared swine meat 

e
t
a
r
n
o
i
t
a
s
i
l
i
t

)
n
t
(

e
m
u
l
o
V
U
210 22% 
545 27% 
0% 
874 28% 
5% 

47

0

TRQs granted by the Central America to the EU – Utilisation in 2014 

2.6. 

Services  

Services trade data lag behind and are not available for 2014. It is therefore not yet possible to 
make  an  analysis  comparable  to  the  one  for  trade  in  goods  to  assess  the  impact  of  the 
Agreement.  

Nonetheless, in 2013, trade in services flows increased up to EUR 5.9 billion (+4.5% compared 
to  the  previous  year).  In  2013,  Panama  remains  the  major  trading  partner  in  services  (50%) 
followed by Costa Rica and Guatemala (18% each). 

 Country 
Costa Rica 
El Salvador 
Guatemala 
Honduras 
Nicaragua 
Panama 
Total 

Credit 

Debit 

560.7
202.2
817.2
151.7
174.7
1,480.0
3,386.5

494.6
94.0
204.8
186.4
50.1
1,574.7
2,604.6

Trade in services between Central America and the EU in 2013 

3. 

ACTIVITIES OF THE IMPLEMENTATION BODIES 

3.1. 

Sub-Committee on Technical Barriers to Trade 

On  26  May  2015,  during  the  meeting  of  this  sub-committee,  Central  America  and  the  EU 
reviewed: 

•  The EU legislation on pesticides, food supplements and conformity assessment.  

•  The Central American regulation on textiles labelling,  

•  The Central American regulation on alcoholic beverage labelling, 

•  The Costa Rican technical regulations on fire safety and electrical installations,  

•  The  commitments  taken  by  the  Central  American  region  to  further  their  economic 

integration by adopting regional technical regulations. 

7 

 
 
 
 
 
 
 
 
 
 
 
 
 
As  a  follow  up  to  this  meeting,  different  ad  hoc  videoconferences  were  organised  to  move 
forward on these issues.  

As regards commitments  taken  in TBT areas related to regional economic integration,  Central 
America informed that it is moving forwards as a new legislation is about to  enter into force 
although further administrative procedures need to be developed. 

3.2. 

Board on Trade and Sustainable Development 

On 27, 28 and 29 May 2015, the EU and Central America held the meetings of the institutions 
in  charge  of  monitoring  the  implementation  of  the  Trade  and  Sustainable  Development 
provisions of the Agreement (see part 4 below).  

3.3. 

Sub-Committee on Intellectual Property 

On 26 May 2015, the second meeting of the Intellectual Property Rights (IPR) sub-committee 
took place to review, in particular: 

•  The protection and enforcement of IPR in Central America and specially Geographical 
Indications (GIs) for which most of the certificates of protection were provided before 
the end of 2014. A few oppositions and appeals were still ongoing at the beginning of 
2015, 

•  Possible  actions  to  foster  an  enabling  environment  for  possible  (essentially  privately 

owned) technology transfer 

As  regards  GIs,  the  Parties  showed  willingness  to  discuss  how  to  smooth  procedures  in  the 
future.  It  was  agreed  to  draw  lessons  from  the  complexity  of  the  GI  registration  process  in 
Central America and launch a stocktaking exercise, in due respect of respective legislations.  

This  meeting  was  also  the  opportunity  for  the  EU  to  encourage  Central  America  to  consider 
IPR protection in their evaluation of priorities for cooperation, as technology transfer from the 
private sectors will also depend on good IPR protection in Central America. 

3.4. 

Sub-Committee on Sanitary and Phytosanitary Matters 

On 27 May 2015, the second meeting of this sub-committee covered technical issues related to 
import  requirements,  verifications,  measures  linked  to  animal  and  plant  health.  In  particular, 
Central America and the EU discussed on: 

•  A  timeline  and  working  arrangements  to  ensure  that  the  respective  authorities  deal 

swiftly and in a coordinated manner with import authorisation requests; 

•  The  importance  of  complying  with  standards,  guidelines  and  recommendations  of  the 

international standard setting organisations; 

•  The recent EU measures to fight Xyllela Fastidiosa bacteria; 

•  The level of integration of Central America in SPS matters. 

8 

 
 
As regards the provisions on regional economic integration in SPS matters, the EU underlined 
the need to finish the works to allow free circulation in the region of EU goods listed in Annex 
XIX, by 1 December 2015. 

Overall, this sub-committee was positive and showed an encouraging outcome, which confirms 
that the parties are on track for achieving positive results in the SPS field thanks to a continued 
work on the agreed actions 

3.5. 

Sub-Committee on Customs Procedures, Trade Facilitation, and Rules of Origin 

On 1 and 2 June 2015, Central America and the EU discussed in this sub-committee: 

•  The fulfilment by Central America of its regional integration commitments; 

•  To  agree  on  two  explanatory  notes  in  the  area  of  rules  of  origin  and  on  how  to  solve 
practical problems encountered by the EU and Central America in the implementation 
of the chapter on rules of origin.  

Central  America  and  the  EU  reached  an  agreement  on  Explanatory  Notes  for  completing  the 
EUR.1  movement  certificates  which  will  ensure  consistency  and  clarity  in  the  practical 
application.  These  Explanatory  Notes  are  aimed  also  at  providing  a  tolerance  level  over  the 
exact wording and format required for the EUR.1 certificates. 

The Parties also made progress as regards the adaptation of the Agreement to the classification 
amendments introduced as result of the Harmonized System 2012.  

3.6. 

Sub-Committee on Market Access for Goods 

On 29 May 2015, during the second meeting of this sub-committee, Central America and the 
EU  reviewed  the  commitments  taken  during  the  previous  meeting  and  discussed  new  market 
access issues, notably: 

•  The Costa Rican legislation on a minimum export price for bananas; 

•  The Costa Rican commitment to review its excise duty system for beers; 

•  The fee to be charged by Nicaragua for scanning goods at each checkpoint borders; 

•  To review safeguards measures and management of quotas. 

The EU and Central America also agreed that access to reliable, updated and detailed statistics 
is  essential  to  trade  policy  and  therefore  committed  to  exchange  statistics  to  monitor  the 
evolution of trade in goods and services. 

3.7. 

Association Committee 

On 3 June 2015, the Association Committee held its second meeting to review the work carried 
out  in  the  different  subcommittees  but  also  discussed  other  trade  related  issues.  Particular 
emphasis was given to the regional economic integration issues.  

9 

 
 
During this meeting, the EU welcomed the recent amendments introduced to Panama's law on 
auxiliary maritime services (Law 41/2013), which removed the requirements which had caused 
concerns, notably among EU economic operators.  

As regards regional economic integration, Central America explained that the fulfilment of the 
commitments  taken  towards  the  EU  was  followed  very  closely  by  Central  American  Trade 
ministers in COMIECO. The EU insisted on the importance for Central America to keep alive 
the positive momentum generated by the application of the Agreement and stressed that Central 
America should pay particular attention in progressing further on these issues. 

As regards the necessary amendment of the Agreement as a result of the adhesion of Croatia to 
the  EU,  the  Parties  recognised  that,  despite  some  progress,  there  is  still  a  gap  between  the 
approaches as regards the methodology to assess compensations. It was agreed to continue the 
dialogue on this point with a view to finding an agreement as soon as possible. 

3.8. 

Association Council 

The Association Council held on its first meeting on 27 June 2014. This year, the Parties have 
not considered it necessary to hold a meeting of the Association Council. 

4. 

FULFILLMENT  OF  OBLIGATIONS  ON  TRADE  AND  SUSTAINABLE 
DEVELOPMENT 

4.1 

Institutional Aspects 

The second meeting of the Board on Trade and Sustainable Development was held in Brussels, 
Belgium  on  27-28  May  2015.  The  meeting  was  hosted  by  the  European  Commission  with 
participation of representatives of the governments of the six Central American parties. 

A meeting of the Civil Society Dialogue Forum – comprising representatives of EU and Central 
American civil society - and a joint session of the Board and Forum were held on 29 May 2015, 
chaired by a representative of the EU Domestic Advisory Group (DAG). 

The EU DAG agreed its rules of procedure and met three times during the year. The EU DAG 
comprises  representatives  from  a  broad  range  of  EU  civil  society  organisations  and  the 
European Economic and Social Committee (EESC). The Secretariat is provided by the EESC. 
Domestic  advisory  groups  were  also  established  by  the  Central  American  parties  and 
information was exchanged on their composition and contacts facilitated between them and the 
EU DAG.   

4.2 Implementation of International Labour Organization (ILO) Conventions 

During  the  Board  meeting,  the  Parties  reported  on  their  implementation  of  ILO  conventions.  
Several  Central  American  countries  emphasised  actions  undertaken  to  tackle  child  labour.  
Honduras  and  Panama  reported  on  recently  adopted  labour  legislation  and  policies.  The  EU 
reported  on  progress  in  ratification  by  EU  Member  States  of  the  new  ILO  Protocol 
supplementing the Forced Labour Convention, as did several Central American countries.  The 
EU also presented its policies on health and safety at work and related structures for dialogue 

10 

 
 
with social partners.  A number of clarifications were provided by Central American parties on 
questions related to implementation of ILO conventions.   

A capacity-building programme was agreed with the ILO in 2015 that will provide support to 
Guatemala and El Salvador to help them meet their commitments under ILO Conventions.   

4.3. Implementation of multilateral environmental agreements 

Special emphasis was placed in the Board meeting on climate change and the Parties reported 
on a number of actions taken in this regard.  Central America emphasised the vulnerability of 
its  agricultural  and  related  agro-industrial  sectors  to  climate  change  and  extreme  weather 
events.  As such products constitute the bulk of its exports to the EU there is a clear economic 
and trade impact.  Several countries have developed sectoral programmes and targets to reduce 
the carbon footprint of the targeted sectors.  Many have ambitious programmes to increase the 
share  of  renewable  energy  and  are  interested  in  investments  and  technologies  in  this  sector.  
The EU set out its general climate change objectives and policy and, together with Costa Rica, 
provided a briefing on the state of play of the Environmental Goods Agreement negotiations. 

Updates were also provided on the implementation of the Convention on Trade in Endangered 
Species (CITES), the Convention on Biological Diversity (CBD) and the Minamata Convention 
on Mercury.   

4.4. Development of a positive agenda for trade and sustainable development 

Further  discussions  took  place  in  the  Board  meeting  on  priorities  for  a  positive  trade  and 
sustainable  development  agenda,  building  on  the  initial  discussion  that  took  place  in  the  first 
meeting  in  November  2014.    The  discussions  were  enriched  by  interventions  in  the  joint 
session  of  the  Board  and  Civil  Society  Dialogue  Forum,  where  inter  alia  the  importance  of 
taking into account the gender dimension was emphasised.  In addition a workshop was held in 
Brussels on 29 May 2015 on fair trade and sustainability in agricultural value chains, bringing 
together  representatives  of  fair  and  ethical  trade  schemes,  trade  associations  and  producers, 
both from the EU and Central America, to exchange best practices and experiences in this area 
– notably with regard to the sugar and coffee sectors. Discussions continued inter-sessionally to 
further define priority areas with both environmental and labour dimensions.   

5. 

IMPLEMENTATION OF THE REGULATION 

The Regulation establishes the appropriate procedures to avoid serious harm to the EU banana 
sector if, as a result of the reduction of customs duties, bananas are imported in such increased 
quantities as to cause or threaten to cause serious injury to the EU sector. In line with Articles 3 
and  13  of  the  Regulation,  the  Commission  has  been  monitoring  the  evolution  of  imports  of 
bananas from Central American countries to assess if the conditions set out in the Regulation 
are met to initiate a safeguard investigation or introduce prior surveillance measures.  

In  2014,  the  Commission  neither  initiated  nor  received  any  requests  to  initiate  a  safeguard 
investigation  or  to  introduce  prior  surveillance  measures,  as  the  conditions  set  out  in  the 

11 

 
 
 
 
Regulation  to  initiate  a  safeguard  investigation  or  introduce  prior  surveillance  measures  were 
never met. 

% 
Country 
48% 
Guatemala 
8% 
Honduras 
0% 
Nicaragua 
49% 
Panama 
75% 
Costa Rica 
0% 
El Salvador 
65% 
Total 
2014 import of bananas under the stabilisation mechanism (in kg) 

Trigger Level
60,000,000
60,000,000
12,000,000
450,000,000
1,230,000,000
2,400,000

Used Volume
28,972,780
4,502,645
0
222,446,518
924,184,789
0

1,180,106,732

1,814,400,000

6. 

CONCLUSION 

Overall,  the  agreement  appears  to  work  well  and  the  implementation  process  is  continuing 
steadily. 

Despite the stable global economic environment, EU trade flows with Central America proved 
to be fairly dynamic. Although the coffee rust and the relocation of a major exporter have had a 
strong impact, the rest of the exports from Central America to the EU grew by 11% in 2014. 
EU exports to Central America have also grown in the same order of magnitude. 

The utilisation rate of the preferences remains quite low for EU exports to Central America, but 
is  better  for  EU  imports  from  Central  America.  Communication  efforts  on  both  sides  of  the 
Atlantic are necessary to increase the knowledge of the benefits that the Agreement can bring. 
The  Commission  is  engaged  in  actions  aimed  at  increasing  the  awareness  of  the  economic 
operators as regards the opportunities presented by the Agreement.  

The tariff-rate quotas not being exhausted, they still offer opportunities for economic operators 
to  develop  trade  relations  further.  As  regards  bananas,  imports  from  Central  American 
countries  remained  overall  stable  and  below  the  established  trigger  levels,  so  that  it  was 
unnecessary to consider initiating any suspension of preferential customs duties. 

For  the  years  to  come,  the  main  EU  priority  remains  to  continue  the  good  cooperation  with 
Central  America  to  achieve  the  proper  implementation  of  the  Agreement.  This  will  allow 
economic operators, consumers and civil society from both regions to take full advantage of the 
opportunities  it  offers.  The  good  functioning  of  the  institutions  created  by  the  Agreement  is 
pivotal in this exercise as they allow discussing and seeking solutions to market access issues 
as  well  as  other  implementation  challenges.  The  Commission  will  continue  to  engage  in 
discussing with Central America any concerns related to the implementation of this Agreement 
raised  by  stakeholders.  The  Commission  invites  the  EU  Member  States  and  the  European 
Parliament to continue to stay involved and to voice their opinion on this matter. 

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