According to Dow Jones Newswires, the Colombian government may take legal action against Ecuador in the Andean Community of Nations and the World Trade Organization if Ecuador fails to lift safeguards imposed on imports from Colombia. Approximately 1,400 Colombian products are now subject to the tariffs, including textiles, shoes and cars.
Ecuador introduced tariffs on Colombian goods on July 11 in what it described as a bid to increase the competitiveness of domestically produced items. However, Colombian trade minister, Luis Guillermo Plata, pointed out that no restrictions had been made on goods produced in other countries, for example Peru. He also said that the Colombian peso, which is legal tender in Ecuador, has appreciated by 10% against the US dollar this year.
Mr Plata hopes the issue will be resolved through discussions, but says the government may be forced to pursue the matter in court should a resolution not be reached. The country may also introduce tariffs on imports from Ecuador, although the government hopes this can be avoided.
Ecuador is currently Colombia’s the third largest export destination. Textile and clothing exports to the country totalled $140 million in 2008. However, there are now fears the tariffs could cause exports for the sector to fall to as low as $15-20 million per year.
