The 3rd Trade Policy Review of Guatemala (16 and 18 November 2016)
Statement by the Republic of Korea 1. Opening Remarks
Thank you, Madam Chair.
I would like to join the previous speakers in extending a warm welcome to the delegation of Guatemala for its third trade policy review, and especially thank Minister of Economy, H.E. Ruben Morales Monroy for his comprehensive presentation. We would also like to thank Ambassador Juan Esteban Aquirre (of Paraguay) for his insightful comments as a discussant as well as the Secretariat for its comprehensive and informative report.
2. Korea-Guatemala Bilateral Relations
Korea and Guatemala have developed a strong bilateral economic relationship. The bilateral trade reached 546 million US dollars in 2015.
Korea was the 7th largest exporter to the Guatemalan market. Korean companies and business people have been one of the leading foreign investors in Guatemala. In particular, Korea and Guatemala are currently negotiating a Central America Free Trade Agreement with other five Central American countries. We believe that the FTA will be a huge stepping stone to the further progress of the economic partnership between our two countries. In this regard, it is our hope that the negotiation will be concluded soon in a mutually beneficial way.
3. General Assessment on the Trade Policies of Guatemala Madam Chair,
Guatemala has participated actively in the WTO. In particular, Guatemala has been one of the active members in the negotiation of the Trade Facilitation Agreement. In this regard, we hope that Guatemala will soon
ratify it before the end of 2016. Also, Korea highly appreciates that, as the Secretariat report says, Guatemala did not use any trade remedy measures, particularly safeguard measures during the review period, despite the recent drastic increase in the number of trade remedy measures taken by many members.
4. Korea’s Concern on the Trade Policies of Guatemala Madam Chair,
It is clear that Guatemala has achieved many things in regard with trade policy. Despite those achievements, Korea has several concerns of the trade policies of Guatemala, about which we submitted advanced questions. I very much appreciate Guatemala’s response to our advanced written questions and requests. In this regard, please allow me to take this opportunity to re-emphasize our main concerns about some of its trade measures and encourage Guatemala to address them.
First, many Korean companies face difficulties when they enter the Guatemalan market due to customs administration and procedures. The difficulties include the high frequency of immediate verification, seriously delayed customs process due to frequent breakdowns of computer system for customs declaration, among others.
Second, many Korean business people and investors suffer from unexpected changes of law related to Free Zones, which has been taken without any proper considerations for the protection of the legitimate rights of the existing businesses. While Korea highly appreciates Guatemala’s continuing effort to comply with WTO commitments on eliminating prohibited export subsidies and Guatemala’s answer to our related questions, we would like to reiterate this issue, since it is directly related to maintaining a stable and predictable investment environment.
Korea has also concerns regarding more transparent government procure market, delayed reimbursement of VATs in the Free Zones and an ad valorem tax on the first registration of automobiles, about which we submitted advanced questions and Guatemala has answered to them. We
will carefully review Guatemala’s answers and would like to keep discussing with Guatemala to resolve the remaining issues, if any.
5. Concluding Remarks Madam Chair,
I would like to conclude by expressing my appreciation to the delegation of Guatemala once again and I wish the delegation every success in its TPR.
Thank you.
***
