$273M in Ecuadorian exports at risk in dispute with Colombia
Feb. 23 (UPI) — Nearly $273 million in annual Ecuadorian exports are at stake if a reciprocal 30% tariff announced by Ecuador and Colombia takes effect, according to the Ecuadorian Federation of Exporters, Fedexpor.
The trade group said 580 Ecuadorian companies export to Colombia and warned that for several of them, the impact of new tariffs could be devastating, as up to half of their revenue depends on that market.
Although the tariff has not been implemented, Fedexpor said uncertainty is already affecting business decisions. Colombian buyers are reluctant to close deals amid the possibility that the measure could made formal in the short term, local newspaper Primicias reported.
The government of President Daniel Noboa announced Jan. 21 that Ecuador would impose a 30% tariff, described as a “security fee,” on imports from Colombia. Quito said the move responds to what it considers a lack of commitment by the government of President Gustavo Petro to border security.
Colombia responded the following day by announcing a reciprocal 30% tariff on 20 products imported from Ecuador. It also decided to cut off electricity supplies to Ecuador.
The 30% tariffs were scheduled to take effect Feb. 1, but were not implemented.
Xavier Rosero, president of Fedexpor, said there remains a “window of time” for both governments to reach an agreement on security and trade matters.
Industrial products such as fats, vegetable oils, canned tuna, plastics and rubber face high uncertainty. Orders for these goods, which are key in bilateral trade, are currently on hold, Rosero told digital outlet El Oriente.
He added that Colombian buyers are already seeking alternative suppliers in China, Brazil and Mexico to replace Ecuadorian products, a shift that could result in market losses that are difficult to recover.
Ecuadorian palm oil is among the most affected products, valued at roughly $96 million annually.
The palm oil sector generates 110,000 jobs across 14 provinces, mainly in border areas. It exports between 6,000 and 8,000 metric tons per month to the Colombian market — volumes that could be redirected to other destinations, though that would not be easy, according to Ecuavisa.
Fedexpor estimates about 40,000 jobs are tied to Ecuadorian companies with significant sales to Colombia. Once the tariff is applied, it could affect more than 50 Ecuadorian products.
Rosero acknowledged as “legitimate” the Noboa government’s concern over security conditions along the shared border with Colombia, describing it as “a key space for trade, but also one that has been vulnerable to illicit activities.”
The dispute is now under review by the Andean Community’s courts after complaints filed by Colombia and counterclaims from Ecuador, in a process that could prolong commercial uncertainty.