White House and Guatemala Announce Reciprocal Trade Agreement Framework

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White House and Guatemala Announce Reciprocal Trade Agreement Framework

The United States and Guatemala have announced a Framework for an Agreement on Reciprocal Trade, enhancing their long-standing economic ties. This new agreement builds on the foundations set by the Dominican Republic-Central America-United States Free Trade Agreement (CAFTA-DR), which began implementation in 2006.

Key Features of the Reciprocal Trade Agreement

The framework includes several commitments from Guatemala aimed at addressing trade barriers and facilitating more seamless economic interactions. Key components include:

Non-Tariff Barrier Reduction: Guatemala will streamline regulatory processes for U.S. exports, including pharmaceutical products and medical devices.
Import Restrictions: The country plans to remove import limitations on remanufactured goods and accept U.S. automotive standards.
Certification Processes: Guatemala will expedite product registrations and accept electronic certificates, while eliminating unnecessary apostille requirements.
Agricultural Trade Facilitation: Measures will be taken to address and prevent barriers to U.S. agricultural products, ensuring compliance with U.S. regulatory oversight.
Intellectual Property Protection: Guatemala commits to uphold international intellectual property treaties and resolve long-standing challenges highlighted in the U.S. Trade Representative’s Special 301 Report.

Digital Trade and Regulatory Best Practices

Guatemala will also take significant steps to enhance digital trade by refraining from imposing discriminatory taxes against U.S. digital services. This commitment includes:

Ensuring the free flow of data across borders.
Supporting a moratorium on customs duties related to electronic transmissions at the World Trade Organization (WTO).
Implementing the Joint Initiative on Services Domestic Regulation.

Labor and Environmental Protections

Guatemala emphasizes its commitment to internationally recognized labor rights by prohibiting the importation of goods made under forced labor conditions. Furthermore, it aims to:

Strengthen labor laws and their enforcement.
Adopt high standards for environmental protection.
Combat illegal activities like logging and wildlife trade.

Future Collaborative Efforts

The U.S. and Guatemala are set to finalize the Agreement and prepare for its signature shortly. As a step towards strengthening trade relations, the United States will eliminate reciprocal tariffs on specific qualifying goods from Guatemala. This includes items that are not sufficiently produced in the U.S. and certain textiles and apparel under the CAFTA-DR standards.

Both nations look forward to deepening their trade partnership and finalizing the Agreement in the near future, promising mutual benefits from a more reciprocal trading framework.