Colombia loses the ‘war of potato chips’ against the European Union: what is it about?

Tensions between the Latin American nation with Belgium, Germany and the Netherlands date back to a tariff introduced by Bogota in 2018.

Colombia lost a lawsuit against the European Union (EU) before the World Trade Organization (WTO) for the import tariffs applied by the Latin American nation to frozen French fries from Belgium, Germany and the Netherlands.

“Colombia acted inconsistently with its obligations under Articles 3.1, 3.2, 3.4 and 3.5 of the Antidumping Agreement”, points the WTO in a statement.

The award, however, agreed with the South American country for having launched an investigation against these three countries. By the way, the Ministry of Trade, Industry and Tourism of Colombia manifested his “satisfaction with the decision” and indicated that the country complied with the sentence in a reasonable time.

The dispute over the fries

In 2017, Colombia initiated an investigation against Belgium, the Netherlands, and Germany for importing frozen French fries into the nation. After the investigation, the Government resolved in November 2018 impose antidumping duties of between 3.21% and 8.01% to these tubers from the three countries, by ensuring that the prices of these imports were artificially low.

At that time, the Colombian Federation of Potato Producers (Fedepapa) denounced that imports of these products had increased significantly, going from 20,000 tons purchased during 2013 to 50,000 tons in 2018, collect The Republic.

Due to the imposition of these tariffs, on November 15, 2019, the EU decided Start before the WTO a process of consultations against the Latin American country. However, unable to reach an agreement, on October 6, 2022, Colombia began an arbitration process before the international organization in order to resolve the conflict.

Does the ruling of the WTO favor the European Union?

The ruling issued by the WTO on Wednesday regarding the dispute determined that Colombia must adjust your tariffs according to the rules of the organization, which favors the European bloc.

Through a statement, the European Commission he pointed that the decision of the WTO benefits the merchants of the region whose exports of potatoes to Colombia, valued at 20 million euroswere harmed by the measures adopted by the Government of former President Iván Duque.

Politico: A trade war between the US and the EU is looming

According to the Europeans, the resolution “sends a strong signal to any country that is considering restricting European exports.”

As detailed by the Commission, Colombia must implement the provision immediately or, in a period previously agreed with the EU. If the South American nation disobeys the mandate, Brussels can adopt countermeasures.

What is Colombia right about?

The Ministry of Commerce, Industry and Tourism of Colombia (MCIT) pointed out that the WTO ruling “supports” the country, for having initiated an investigation that ended in the imposition of anti-dumping duties against the three European nations.

Despite this acknowledgment, the award obliges Colombia to adjust the tariff rates on frozen French fries, by correcting the calculations to the country’s antidumping margins.

According to Explain the MCIT, an antidumping margin corresponds to the “amount by which the price of the export product is less than the normal value”. In the case of Colombia, this indicator cannot be less than 2%.

If you liked it, share it with your friends!

Leave a Comment

Your email address will not be published. Required fields are marked *