CAFTA Helps Costa Rica to enhance Trade with US

The Costa Rican Ministry of Foreign Trade (COMEX) stated that the total sales of country’s exports to the US rose 24 percent in 2010. Foreign Trade Minister Anabel González attributed the increase in exports due to the reduction in tariffs as applied through the Central American Free-Trade Agreement (CAFTA), which came into effect on January 1 2009.

Last year, the export revenue from the US was well over $3.3bn, up from $2.7bn in 2009. The US was the largest export destination for the Costa Rican exports in 2010.

An enormous importance this year was the growth in the number of exports to the US,” González said. “What this appears to indicate is that CAFTA is providing the results that we expected. The 24 percent increase is a very significant increase.”

The export of commodities to the US such as pineapples, bananas, tuna, medical devices and sugar largely contributed to the increase in export revenue. Among the items, sugar exports recorded 192 percent growth in 2010.

The Costa Rican overall exports were about $13.59bn during the last year, a 7.5 percent increase from the previous one. Out of the total, about 36 percent of sales of goods abroad went to the US and almost 18 percent reached the 27 countries of the EU. While these two destinations accounted for 55 percent of total sales, Asia chipped in with14 percent.

González had said earlier this month that since some countries in the EU as well as the US itself would continue to experience economic uncertainty, the Costa Rican products too might be affected. However, the COMEX predicts the export target of $15bn in 2011, which includes both goods and services, could be achieved.

According to the COMEX, Costa Rica has the third largest export sales per capita income in Latin America in 2010, topped only by Uruguay and Mexico. The largest revenue yielding exports in 2010 were electronic components and microprocessors, despite a 12 percent decrease in sales.

Costa Rica remains the world’s top exporter of pineapples and the second largest exporter of bananas. A total of 4,255 different Costa Rican products were shipped to 148 different destinations in 2010, including Africa and Australia.

By Jose Roy