texfash.com: It has been roughly 15 years since the United States–Colombia Trade Promotion Agreement (USCTPA). For US yarn, fabric, apparel, and footwear manufacturers, this meant increased market opportunities. But how has it worked out for the Colombian industry? What comparative figures would you be looking at?
Craig Dempsey: The US-Colombia Free Trade Agreement (FTA) was signed in 2006 and implemented in 2012. Its main objective was to increase trade and investment between the US and Colombia by removing tariffs and other trade barriers.
The effect of the FTA has been largely positive for both countries. In the years following its implementation, US exports to Colombia have increased, especially in agriculture, chemicals, and manufacturing. This has led to increased economic growth and job creation in Colombia and improved Colombian businesses' competitiveness in the global market. The textiles industry in Colombia is significant and has given occupation to many Colombians—actually 13%.
The increased competitiveness and economic growth have helped the sector grow substantially in the past years and have been very economically beneficial for Colombia and the industry. When looking at the effect of the USCTPA, it is essential to look at each of the sectors and compare the effects (positive and negative). Each industry is very different, with its market mechanisms and factors influencing the economy and the Colombian people.
Overall, the US-Colombia FTA has helped improve the economic relationship between the two countries and has positively impacted trade and investment flows.
Apart from the US, Colombia also has some 15-16 other trade agreements. How is Colombia making them all work together? Is it too dependent on the US?
Craig Dempsey: Colombia has actively negotiated and implemented trade agreements with various countries and regions. In addition to the USCTPA, Colombia has signed trade agreements with countries in the Americas, Europe, and Asia. Some of these agreements are comprehensive and cover a wide range of issues, while others are focused on specific sectors or areas of trade.
To manage these different agreements and ensure they complement each other, Colombia has adopted a multi-layered approach to trade policy. This includes negotiating trade agreements at both the bilateral and regional levels and active participation in international organisations such as the World Trade Organization (WTO) and the Pacific Alliance.
In terms of dependence on the US, Colombia has made efforts to diversify its trade relationships and reduce its reliance on any one country. While the US remains an important trading partner for Colombia, the country has also increased its trade with countries in other regions, including Europe, Asia and Latin America.
Overall, Colombia's multi-layered approach to trade policy and efforts to diversify its trade relationships have helped it to effectively manage its trade agreements and reduce its dependence on any one country.