Ecuador increases tariffs on Colombian goods to 50% starting March 1

Ecuador Raises Tariffs on Colombian Imports

The Ecuadorian government has announced that it will significantly increase tariffs on imports from Colombia, effective March 1. The new tariff rate of 50% supersedes the initial 30% rate imposed in early February.

The decision follows a growing trade and security dispute between the two neighboring Andean countries. Ecuador’s President Daniel Noboa has been pressing his counterpart, Gustavo Petro, to strengthen border security measures against organized crime.

Ecuador has cited a growing trade deficit as justification for the protectionist measures. According to data from the Observatory of Economic Complexity, nearly 4% of Colombian exports go to Ecuador, worth approximately $2.13 billion. Ecuador also imports significant quantities of medicines and pesticides from Colombia.

The new tariff hike is part of a series of retaliatory measures taken by Ecuador in response to Colombia’s actions. In February, Colombia suspended all energy sales to Ecuador following the initial tariffs imposed by Quito. The suspension has raised concerns about the impact on Ecuador’s power generation, particularly given recent droughts that have disrupted hydroelectric dams.

The transportation of fossil fuels has also become a point of contention between the two countries. Ecuador’s government has increased fees for Colombian crude delivered through the Trans-Ecuadorian System Oil Pipeline by 900%, while Colombia has halted all oil shipments through the line.

Foreign policy and security officials from both countries met in Ecuador earlier this month, but no breakthrough was achieved. The latest tariff hike is seen as a significant escalation of the dispute between the two nations.

Source: Al Jazeera