Costa Rica has joined the Dominican Republic, El Salvador, Guatemala, Honduras and Nicaragua as a member of the US-Central America-Dominican Republic Free Trade Agreement (CAFTA-DR).
The deal came into force on 1 January and will reportedly eliminate tariffs on 99 per cent of Costa Rica's exports including tropical fruits.
“This step marks an important milestone in our relationship with Costa Rica, building on our strong economic and political partnership,” US Trade Representative Susan Schwab said in a statement.
“We have worked closely with Costa Rica, as we have with our other CAFTA-DR partners, to ensure they meet their obligations and responsibilities under the agreement. Costa Rica is now ready to join the Dominican Republic, El Salvador, Guatemala, Honduras and Nicaragua in putting the agreement into force, ensuring that the benefits of this agreement continue to spread. US trade with CAFTA-DR partners – and among CAFTA-DR partners – has increased as the countries have put the agreement into force.”
The US is Costa Rica’s main trading partner, absorbing around half or US$9bn-worth of the Central American country’s exports each year.
Up to November 2008, shipments to the US reach some US$3.6bn, according to the Costa Rican trade ministry, including fruits such as bananas and pineapples, as well as medical and vetinary equipment and computer accessories.
US exports to the Dominican Republic and the five Central American countries hit a record US$22.4bn in 2007, according to the US trade office.
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