San Salvador, El Salvador – The Salvadoran Corporation of Exporters (Coexport) has expressed enthusiasm over the potential for a new trade agreement between El Salvador and the Southern Common Market (Mercosur), a trade bloc founded in 1991 by Argentina, Brazil, Paraguay, and Uruguay.
Last week, the Ministry of Economy announced the initiation of trade negotiations with representatives from the bloc.
Silvia Cuéllar, president of Coexport, told Diario El Salvador that an alliance of this magnitude represents a significant opportunity for expansion for domestic exporters.
“Whenever there is talk of a free trade agreement, it signifies an opportunity. It's a chance to reach new markets because we don't have many exports to these countries. It's not just about tariffs, but also about untapped potential, as the export sector has traditionally focused on the North,” she said.
Cuéllar emphasized that the agreements reached by the Ministry of Economy are opening doors to the south. However, she noted that while this is very positive, it also presents a challenge as a thorough exploration of the needs of these markets is required to understand how to effectively approach them.
“We're seeing a promising opening, as there’s also talk of Peru, which is an interesting market, and we already have Colombia. This adds up. Exporters can see greater opportunities towards the south with these markets […] It's also a challenge because these are not so well-known markets. We need to explore to understand what possibilities exist, what products are in demand, and what products we could direct towards those markets,” she mentioned.
According to the administration of Nayib Bukele, if the project is finalized, local businesses could reach 200 million potential consumers. Currently, food products, metals, hand tools, footwear, very few apparel products, and natural products are sent to South America.
Furthermore, Cuéllar highlighted the potential for increased foreign investment in El Salvador. "It's also an opening of those markets towards us, a window for investment," she detailed.
Meanwhile, the Minister of Economy, María Luisa Hayem, assured that the new reality in El Salvador has transformed the country into an increasingly attractive destination for tourism, investment, and free trade agreements.
“We have advanced in the work being done on the issue of free trade agreements, and countries are interested in having relations with El Salvador,” she added.
It's worth noting that Mercosur was created with the objective of promoting the free movement of goods, services, and productive factors among member countries, through the elimination of customs duties and non-tariff restrictions on the circulation of goods and any other equivalent measure.
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