MercoPress. South Atlantic News Agency

Central America and EU reach a free trade agreement

The agreement will benefit Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama

Central American countries and the European Union (EU) reached on Tuesday an agreement on the first ever free trade deal between the two regions, they announced in a joint statement.

The deal between the 27-nation EU and the Central American nations of Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama followed “an intensive negotiation process” and was announced during the EU/Latam-Caribbean leaders’ summit in the Spanish capital Madrid.

“The EU and Central America ... have finalised the negotiations on the trade pillar of the Association Agreement,” the statement said. Trade ministers of Central America and the EU express their full satisfaction with the outcome, which “will result in an ambitious, comprehensive and balanced trade pillar of the Association Agreement”.

The negotiations are to be formally concluded by EU and Central American leaders at their summit meeting on Wednesday.

It is the first ever deal of its kind between the 27-nation bloc and Central America.

The six Central American countries have been in talks on a free trade deal with the European Union since 2007.

The deal follows agreement on Monday between the EU and the four-nation South American trading bloc Mercosur to resume talks aimed at reaching a free trade agreement, despite opposition from a number of European nations.

“This summit has shown that we recognize ourselves as global partners”, said president Jose Luis Rodriguez Zapatero from Spain whose country holds the six month rotating presidency of the EU.