“Today our governments send a clear signal to investors and businesses to raise their expectations and aspirations so that all citizens may have a more optimistic future,” said minister Sergio Diaz-Granados.
The FTA’s negotiations have been in place since May 2010 but Diaz–Granados and the EU’s European Commissioner for Trade, Karel De Gucht, met Tuesday to sign the document.
According to Diaz-Granados, the FTA will benefit Colombia’s industrial and agricultural sectors and is expected to double trade within the next eight years. The trade deal will reportedly allow 99.9% of Colombian industrial exports to have tariff-free access to European markets, and, according to Diaz-Granados, will help Colombia compete with the host of other countries that already have FTA agreements with the EU like Mexico and Chile.
Even in light of the Eurozone’s economic troubles, the deal is expected to boost Colombia’s trade with the region substantially, given that the EU, whose 27 members are counted as a single entity, is the country’s second-largest trade partner.
“The EU, despite the economic cycle it is going through, remains the most important region for global trade, it’s the one that buys the most services and products,” said Diaz-Granados.
On June 13 the EU passed a resolution supporting the FTA, but conditioned its passing on Colombia’s compliance with labor rights, including freedom of workers to unionize, as well as environmental regulations. Colombia has received criticism for being the most dangerous country in the world for union workers. According to a recent report by the International Trade Union Confederation, at least 29 union workers were killed in Colombia in 2011.
In the finalization of the agreement Tuesday, the EU required Colombia to guarantee “labor inspections that could lead to strict penalties for the mistreatment of workers.”
Colombia’s Constitutional Court and Congress must still review and approve the trade agreement before it comes into effect, for which a date has not yet been specified.
Colombia also announced the finalization of the FTA with South Korea Tuesday. Over the next ten years, the deal will eliminate 95.1% of tariffs on Colombian goods and 96.7% on South Korean products, in addition to increasing trade with the Asian economic force that imported over $400 billion worth of goods last year.
The announcement of the two deals comes on the heels of an FTA with the United States that went into effect May 15 after similar criticism from human rights acitivists and U.S. officials over Colombia’s labor and human rights situation.