On November 6, Decree 1419 of 2019 came into force in Colombia, setting an increase of between10% and 37% in customs duties on certain imported goods from countries with which it has no free trade agreements (FTA) in force, including the Republic of Panama. The measure will have a major impact on the garments industry, and further news is expected on this subject during the official visit to Colombia of the Panamanian President Laurentino Cortizo, on November 13.
The measure is a key issue in the trade dispute which began in 2013 between Panama and Colombia following the increase in tariffs on footwear and textiles from the Colon Free Zone. On August 6, 2019, the Colombian Ministry of Commerce adopted the aforementioned decree which establishes that garments from countries with no FTA must pay duties of 37.9% per kilogram of a value of under 20 US dollars, and 10% plus 3 US dollars per kilogram, when the declared value is more than 20 US dollars per kilogram.
On August 15, Panama’s Foreign Minister Alejandro Ferrer met with Colombian Foreign Minister Carlos Holmes Trujillo García in Bogotá to discuss their bilateral agenda in comprehensive fashion. This was when the Panamanian representatives expressed their disagreement with the Colombian decree. Daniel Rojas, president of the Association of Users of the Colon Free Zone, said that the new tariffs represent a blow to the free zone and the country’s economy. “This tariff issue should definitely be on the agenda of President Laurentino Cortizo during his next visit to Colombia on Wednesday, November 13,” said Rojas.