The European Commission has started a public consultation concerning the free trade agreement between the EU and Colombia, Peru, Ecuador
Why are trade deals useful?
Trade deals create numerous benefits for both exporters and importers. International trade results in a wider choice for the consumers, higher quality goods and lower prices. International trade also helps to strengthen business competitiveness and promote sustainable development. Furthermore, trade deals play an important role in job creation, business growth and investment (European Commission, 2021b).
The Andean Community and the EU
The Andean Community was founded in 1969, aiming at interregional integration. It currently includes four countries: Bolivia, Colombia, Ecuador, and Peru (European Union External Action Service, 2016). Until 2012 the countries of the Andean Community had benefited from a unilateral preferential EU market access (Dongo, 2021). In today’s article we will focus on the agreements between the EU and Colombia, Peru and Ecuador. The EU has had, in fact, a comprehensive Trade Agreement with Peru and Colombia since 2013 and with Ecuador since 2017 (European Commission, 2021a).
The World Bank reform of the preferential system would not have allowed Colombia, Peru and Ecuador to maintain their preferential market access, so negotiations were started to find a new deal – reached in 2010 after 9 negotiation cycles – with the European Union. The agreement between the EU and Colombia, Peru and Ecuador is one of the first new-generation Free Trade Agreements, as it aims at facilitating access to the markets of the concerned countries by promoting a sustainable development which may increase the stability and predictability of the investment and of the financial and commercial contexts (Dongo, 2021).
Unlike traditional Free Trade Agreements, the new treaty concerns not only the trade liberalisation of goods and services, but also investment, public contracts, competition, intellectual property rights, commerce and sustainable development (Dongo, 2021).
Trade and Sustainability
The new UE strategy regarding Trade and Sustainable Development (TSD) is concerned with workers’ rights, environment preservation and civil society. It aims at promoting the rules which protect the workers, focusing on the elimination of forced labour, child labour and discrimination. Moreover, its purpose is to strengthen the reciprocal support of trade and environment (Dongo, 2021). The problem is that violations of these rules do not result in the suspension of the trading benefits of the part responsible, as these violations are only exposed to a moderate alternative procedure to find a solution to litigation (Dongo, 2021).
Problems in the Andean Community
Colombia’s export rates of palm oil have been increasing – 52% of Colombian palm oil is imported by the EU. But the palm oil plantations are a debated question, as local farmers and indigenous people are forced to abandon their crops for this type of activity. This phenomenon, known as land grabbing, concerns both Colombia and Peru and has attracted the attention of international observers (Dongo, 2021).
As far as the working conditions are concerned, the basic rights mentioned in the international agreements are often violated. Notably, in Colombia violence in the working sector is sadly common, and in Peru child labour and black-market labour are frequent events, while freedom of association and collective bargaining are almost unknown (Dongo, 2021).
The Free Trade Agreement between the EU and Colombia, Peru, Ecuador has to consider an examination of the respect for fundamental human rights and for the environment. These elements, in fact, represent a pre-requisite and fundamental condition for the agreement.
The European Parliament, with its resolution 22.10.20 concerning deforestation and biodiversity, has encouraged the European Commission to ban the importation of commodities and goods coming from industries which do not respect the environment. While waiting for this environmental justice act it is demanded that importation of palm oil from Colombia be interrupted (Dongo, 2021).
Dongo, D. (2021). Accordo di libero scambio tra UE e Colombia, Perù, Ecuador. Consultazione pubblica a Bruxelles. Retrieved March 8, 2021, from GIFT – Great Italian Food Trade website: https://www.greatitalianfoodtrade.it/mercati/accordo-di-libero-scambio-tra-ue-e-colombia-perù-ecuador-consultazione-pubblica-a-bruxelles
European Commission. (2021a). Andean Community. Retrieved March 8, 2021, from Countries and Regions website: https://ec.europa.eu/trade/policy/countries-and-regions/regions/andean-community/
European Commission. (2021b). Exporters’ Stories. Retrieved March 8, 2021, from In Focus: Exporters’ Stories website: https://ec.europa.eu/trade/trade-policy-and-you/in-focus/exporters-stories/#p=#filter-partners-Colombia&c=*#p=#filter-partners-Colombia&c=*
European Union External Action Service. (2016). Andean Community. Retrieved March 8, 2021, from https://eeas.europa.eu/diplomatic-network/andean-community/2049/andean-community_en