The EU and Central America signed an Association Agreement in June 2012
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For the last decade the EU's share in Central American trade has remained largely stable at around 10% (8.5% in 2009). Historically the bulk of most Central America countries trade is with the USA and Latin America, and it is only recently that the region has actively sought to increase its trade with Europe. EU imports from Central America are dominated by office and telecommunication equipment (53.9%) and agricultural products (34.8% in 2010). The most important exports from the EU to Central America are machinery and transport equipment (48.2%) and chemicals (12.3%).

 

All the countries of the Central American region benefit from the GSP+ system as part of the EU's Generalised System of Preferences.

The EU and the Central American region have concluded, in May 2010, the negotiations of an Association Agreement that includes a free trade agreement.

EU goods exports to the Central American Region in 2011: €28.2 billion

EU goods imports from the Central American Region in 2011: €24.6 billion

EU trade statistics for Central American region

Countries of the Central American Region,

• Panama

• Guatemala

• Costa Rica

• El Salvador

• Honduras

• Nicaragua

The EU’s central economic policy objective for Central America is to strengthen the process of regional integration between the region's countries. In practical terms this means the creation of a customs union and economic integration in Central America and the EU has fostered this process through its trade-related technical assistance in the region.

 

The new Association Agreement

At the EU-Latin America and Caribbean summit in 2004, the EU and the Central American region agreed to negotiate a new Association Agreement. Like the existing Political Dialogue and Cooperation Agreement, this new agreement would aim at reinforcing the political and economic stability of the Central American countries, fostering sustainable development and deepening their process of regional integration. This closer economic integration between the countries of the Central American region is important for attracting investment to the region and helping local businesses develop the strength in their regional market to compete internationally. Negotiations on this Association Agreement were launched in 2007 and were successfully concluded by the 2010 Madrid EU – LAC Summit. During the negotiations process, a sustainability impact assessment was carried out by the EU

The text of the Association Agreement was initialed in Brussels on 22 March 2011 and can be found here. This text is provided for information purposes only. It is not binding as a matter of international law. The authentic text will be published in the Official Journal of the European Union following the translation and the completion of the procedures in the Council and the European Parliament for the entry into force of the Agreement.

 

The 2010 Madrid Summit

The EU-LAC Summit took place on 18 May 2010 in Madrid. The theme of the Summit was: 'Towards a new stage in the bi-regional partnership: Innovation and Technology for sustainable development and social inclusion'.

The Madrid Summit, which brought together Heads of State and Governments from Latin America, the Caribbean and Europe, as well as important non-state actors, resulted in a decision to re-launch negotiations for an EU-Mercosur Free Trade Agreement, political approval to the conclusion of a comprehensive trade agreement between the EU and the Andean Countries (Peru and Colombia) as well as the endorsement of the conclusion of the negotiations between the EU and Central America.