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China will use Costa Rica as a strategic platform in Central America.
The Chinese delegation negotiating the Free Trade Agreement (FTA) with Costa Rica allowed us to see part of what their intentions are through the agreement. In more colloquial terms: The Chinese threw their cards, and the first hand was good for Costa Rica.
During the second day of talks, the Asians put three of the priorities on the table which they seek to establish through the bilateral agreement.
Positioning for political purposes, access to Central America and Mexico for their manufacturing and use the country to channel investment from Asia were the noted points.
In what seems a happy coincidence, at least two of the points that Costa Rica is looking for in this agreement with the Chinese are exactly the same as what the Chinese brought in the specifications for proposals.
Costa Rica announced when it launched the treaty that one of its priorities is to secure access to bodies like the Asia-Pacific Economic Forum. “Another crucial aspect, which offers us a more open relationship with China, is an opportunity to become the facilitator of larger and more constant Chinese investment capital arrivals,” explained Marco Vinicio Ruiz, Minister of Foreign Trade.
Seeing that the signs for the arrival of foreign investment during 2009 are ominous, the announcement that there would be interest in directing fresh to the rest of the region through financial institutions and business in Costa Rica might be hopeful.
As part of the work in this first round of talks, it was confirmed that, in addition to developing the negotiations, the task will be undertaken to review the issues involved in ensuring food security, especially when Chinese food irregularities have recently been made public.
Moreover, Maria Luisa Avila, head of the health sector in Costa Rica, will accompany the negotiating team that will travel to Beijing in April for the second round, so that she can review anything relative to the existence and implementation of sanitary protocols.
Although not part of the core issues to be negotiated, whoever is in charge of defending national interests in what will be the final text of the agreement, do not rule out that matters relating to food will be reviewed in parallel, as was done in Peru.
”That issue, the medical protocols, is not part of the negotiation, nor has anything been said about confirming the documents between the two countries. What can not be ruled out is a parallel or later review,” explained Fernando Ocampo, chief negotiator for Costa Rica.
Since it is the most recent treaty signed by the Asian power, the Peru FTA will be used as a basis for the one being negotiated with Costa Rica.
In the midst of the process, the national representatives received a “warning” from one of the sectors that is following the negotiations.
The Costa Rican Chamber of Food Industries (Cacia by its initials in Spanish) said that its production and the raw materials that feed it must be handled with extreme caution and vigilance in the context of this negotiation.
”Our Chamber considers that our greatest concerns about the risky and ill-conceived tariff policy which is negotiated with the opening of our industry have been ignored because processed foods are liberalized but the raw materials are protected, which is a contradiction and shows a bad practice in the negotiations which have already generated great harm to our industry,” expressed Tomas Pozuelo, president of Cacia.
Faced with a scenario such as this, if Costa Rica and the negotiating team know how to properly handle the opportunities, the country could become the nucleus for a number of businesses in the area of services for the Chinese and thus contribute to their expansion in the region.
But as we have said, it must be managed wisely and skillfully so that benefits removed overnight. On the other hand, what Cacia mentioned is something that should be handled with the utmost care; this is so that the conditions for national producers do not worsen.
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