What Is The Central American Free Trade Agreement

El Salvador was the first country to formally implement CAFTA to enter into force on March 1, 2006, when the Organization of American States (OAS) received copies of the treaty. Honduras and Nicaragua fully implemented the agreement on 1 April 2006. On 18 May 2006, the Guatemalan Congress ratified THE CAFTA-DR, which came into force on 1 July 2006. The Dominican Republic implemented the agreement on 1 March 2007. In a referendum on 7 October 2007, Costa Rica supported the free trade agreement to just under 51.6% and voted ”yes”; The agreement came into force on 1 January 2009. [6] CAFTA-DR also improves customs administration and removes technical barriers to trade. It covers public procurement, investment, telecommunications, e-commerce, rights, transparency, labour and environmental protection. Chapter 4 on Trade in Services closely follows the approach of the WTO`s General Agreement on Trade in Services (GATS). It covers trade in all service sectors under the four types of supply, with the exception of air transport. A separate annex on financial services (Annex XVII) completes the chapter with specific disciplines for this sector. The lists of specific commitments of the contracting parties (annexed to the additional obligations in the field of telecommunications services) and exemptions from the treatment of the most favoured nations (MFN) are included respectively in Appendixes XV and XVI. These lists are subject to regular revision to further liberalize the exchange of services between the two parties. As soon as the agreement enters into force, EFTA states lift all tariffs on imports of industrial products, including fish and other seafood originating in Central American countries.

Participating Central American states will phase out all tariffs on industrial products, including fish and other seafood, originating in an EFTA state (Annex IV and V). All of these goods will be duty-free by 2029. Why has CAFTA, like U.S. trade agreements before and after, failed to reduce widespread labour abuses? Kim Elliot, a member of the U.S. Free Trade Agreements` U.S. Free Trade Agreements, recently proposed this statement bluntly: the working provisions of U.S. trade agreements ”are included because they are necessary to get congressional business.” She added: ”This is really about policy, not how to raise labour standards in these countries.” The objective of Chapter 5 is to improve the legal environment for EFTA investors and Central American countries investing in the other country`s markets.