Caribbean & Central America - August 2012 (ISSN 1741-4458)

Exports down: In the first six months of 2012, El Salvador’s exports reached US$2.67bn, a 3.6% drop on the same period the previous year, according to a report released on 27 July by El Salvador’s Banco Central de Reserva (BCR). The BCR attributes the change to a drop in sales of coffee and maquila products. According to the BCR report, coffee exports declined 34.3% in the first six months of 2012 when compared with the same period in 2011 due to a reduction in volume exported (-42.8%). Maquila exports, which reached US$556m, dropped 7.6% in the first six months of the year when compared with the same period the previous year. Non-traditional products (which accounted for US$1.77bn) increased 3.3% while traditional exports dropped 24.5%.

AAP with Cuba takes effect: On 1 August the partial scope agreement regarding preferential tariffs between El Salvador and Cuba (AAP) took effect.  The agreement, which also includes provisions on issues such as sanitary and phytosanitary measures and the resolution of trade disputes, was first proposed during President Mauricio Funes’s historic visit to Cuba in October 2010 – the first ever by a Salvadorean leader - following his restoration of diplomatic ties upon taking office in June 2009. According to a statement by the Salvadoran economy ministry, the tariff reduction applies to 618 Cuban products and 433 Salvadorean ones, with 71% of Salvadorean products able to enter Cuba duty free as of 1 August. According to the statement by the economy ministry, El Salvador exported goods worth US$7.1m to Cuba in 2011 while Cuban imports reached US$3.4m.