COMMISSION STAFF WORKING DOCUMENT EXECUTIVE SUMMARY OF THE EVALUATION of the impact of the Trade Agreement between the European Union and its Member States, of the one part, and Colombia, Ecuador and Peru, of the other part
Date: 2023-10-04
Institutions: Directorate-General for Trade and Economic Security, European Commission
Subjects: Colombia, Ecuador, Peru, economic consequence, environmental impact, human rights, social impact, trade agreement, trade agreement (EU), trade cooperation

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  EN 

   EUROPEAN COMMISSION  Brussels, 4.10.2023  SWD(2023) 328 final  COMMISSION STAFF WORKING DOCUMENT  EXECUTIVE SUMMARY OF THE EVALUATION  of the impact of the Trade Agreement between the European Union and its Member States, of the one part, and Colombia, Ecuador and Peru, of the other part {SWD(2023) 327 final}  
 
 
The European Union (EU) and its Member States have a comprehensive trade agreement with 
Colombia and Peru. The agreement has been provisionally applied with Peru since 1 March 
2013 and with Colombia since 1 August 2013. On 1 January 2017, Ecuador joined the trade 
agreement.  

The  agreement  gradually  opens  up  markets  on  both  sides  and  increases  the  stability  and 
predictability of the trade and investment environment in all partner countries. The agreement 
is among the first EU trade agreements with a comprehensive scope, also covering trade and 
sustainable development (TSD) issues. 

In  2020,  the  European  Commission  mandated  an  external  consultant  to  undertake  an 
evaluation of the agreement. The evaluation covers the economic, social, environmental, and 
human rights (including labour rights) dimensions of the agreement between April 2020 and 
July 2021. Its results were published in January 2022.  

This  document  presents  the  views  of  the  Commission  on  this  analysis.  It  also  seeks  to 
determine whether there is a need to improve the implementation of the agreement, to ensure 
that  the  parties  take  full  advantage  of  the  opportunities  it  offers  and  whether  its  objectives 
have been reached in terms of the four criteria listed in the EU’s Better Regulation guidelines 
(effectiveness, efficiency, coherence and relevance). 

The  Commission  considers  that  the  implementation  of  the  agreement  worked  well  in 
achieving  its  specific  objectives.  The  agreement  has  played  a  significant  role  in  promoting 
trade and remains relevant for trade in goods between the EU and  the three Andean partner 
countries. Its impact can be assessed as positive, albeit relatively limited.  

More detailed effects and impacts of the agreement are set out in the paragraphs below. 

In  economic  terms,  the  agreement  has  led  to  a  small  increase  in  gross  domestic  product 
(GDP) in all parties individually (i.e. the three Andean countries and the EU Member States) 
and  overall  at  EU  level.  Sectors  in  which  the  parties  have  a  comparative  advantage  have 
benefited most from the agreement. For the Andean countries, these were agriculture and food 
products, but also light industries. For the EU, it was industrial sectors (mainly machinery and 
the automotive sector).  

Among  the  social  impacts,  sectoral  employment  changes  were  in  line  with  the  economic 
performance  of  the  agreement.  In  the  EU,  these  effects  are  considered  negligible.  In  the 
Andean  countries,  the  strongest  positive  effects  were  found  in  agri-food  sectors  such  as 
vegetable,  fruits  and  nuts,  whereas  some  employment  contractions  were  identified  in  a 
number of industrial sectors.  

The environmental impact of the agreement overall is found to be very small.  

The impact of the agreement on the human rights situation in the Andean countries has been 
limited, and no impact could be determined in the EU. 

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The agreement has been moderately effective with regard to achieving the objectives outlined 
in  its  Article  4.  During  negotiations,  all  three  countries  were  benefitting  from  unilateral 
preferential  access  to  the  EU  market  under  the  EU’s  Generalised  Scheme  of  Preferences 
(GSP+). This scheme provided preferential access similar to  that provided under the current 
agreement.  Between  2013  and  2021  bilateral  trade  increased  by  6.5%  overall.  Tariff 
liberalisation has taken place as planned and has led to more trade in goods – both bilaterally 
and overall at EU level – than would have been the case in the absence of the agreement.  

In  addition,  progress  has  been  made  in  registering  and  enforcing  Geographical  Indications 
(GIs).  The  parties  did  not  initiate  any  formal  disputes  against  each  other  and  the  sub-
committees established under the  agreement solved  around half of the  differences identified 
between the parties.  

The  arrangements  for  trade  and  sustainable  development  (TSD)  had  a  tangible  impact  in 
areas  where assistance projects  have been implemented. Dialogue under  these arrangements 
has encouraged the continuation of certain positive activities or prevented the situation from 
worsening. There was not sufficient data available to identify any concrete action or changes 
where the agreement was the determining factor. 

From  an  institutional  angle,  the  agreement’s  efficiency  is  considered  to  have  been  high,  if 
mixed when compared to its objectives. The Trade Committee and the sub-committees have 
played their roles  as forums for exchanging information  and views. However, regarding  the 
resolution  of  trade  irritants,  while  the  system  worked  for  most  technical  disputes,  certain 
issues  of  political  implications  would  require  stronger,  more  dedicated  political  leverage. 
Better  opportunities  for  civil  society  representatives,  particularly  through  dialogue  with 
advisory groups or domestic mechanisms, would greatly improve the ability  of these groups 
to contribute to discussions held by the parties. 

At the time of its signing, the degree of consistency of the agreement with the EU’s overall 
trade  and  environmental  policies  and  its  commitment  to  the  SDGs1  and  the  Decent  Work 
agenda2  was  high.  Overall,  the  agreement  remains  consistent  with  the  main  policies  of  the 
EU. 

Since 2013, new policy priorities have naturally emerged at both EU and global level that are 
not fully captured by the agreement as it currently stands. These include the Paris Agreement 
on Climate Change and the European Green Deal, which includes the Farm-to-Fork policy.  

In  line  with  the  outcomes  of  the  EU  TSD  policy  review,  the  Commission  is  already  taking 
concrete measures to strengthen the effectiveness of labour and environmental commitments 
under the TSD chapter.  

1 Sustainable Development Goals (europa.eu) 

2 Communication on decent work (europa.eu) 

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The vast majority of the TSD review action points can in fact be implemented by the parties 
already  at  this  stage  or  by  means  of  a  decision  by  the  committees  established  under  the 
existing  agreement.  And  the  Commission  is  working  with  the  Andean  authorities  in  this 
regard.  

There are however other types of TSD commitments that would require the agreement to be 
amended.  These  include  providing  for  the  possibility  of  withdrawing  trade  preferences  as  a 
measure of last resort (applying “trade sanctions”), in cases of serious violations of the ILO 
Fundamental  Principles  and  Rights  at  Work,  or  in  cases  of  material  breaches  of  the  Paris 
Agreement.  

To fully implement these remaining action points of the TSD policy review, the Commission 
will  propose  a  targeted  update  to  the  agreement  once  it  has  been  fully  ratified  by  all  EU 
Member States. 

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