More import tariffs go into effect on Wednesday as Ecuador struggles to counteract affects of lower oil prices and a strong dollar
The governement announced on Friday that it will impose import tariffs of between 5% and 45% for 2,800 products, in a bid to mitigate effects of falling oil prices as well as a strengthening U.S. dollar.
The 2,800 products represents about 35% of all imported products entering Ecuador.
Minister of Foreign Trade Diego Aulestia said at a news conference that the new tariffs, which will affect 32% of Ecuadorean imports, will be charged for 15 months will take effect starting Wednesday.
Mr. Aulestia added that the measure complies with World Trade Organization rules and the local private sector has been consulted on the issue.
Among the imports affected are televisions, tires, motorcycles, ceramic cookware and a wide range of consumer products.
Ecuador, which uses the U.S. dollar as its official currency, is trying to protect its balance-of-payments position, which is heavily dependent on the trade account.
Last year Ecuador registered a trade deficit of $727 million.
In early January the country imposed safeguard tariffs of 21% and 7% for Colombia and Peru, respectively, amid the depreciation of the Colombian peso and the Peruvian sol against the U.S. dollar, but on February 27 the tariffs were lifted amid negotiations with both countries.
Since 2012, President Rafael Correa’s administration has been restricting imports, setting quotas on foreign goods, including cellphones and cars, and raising duties on several products with the aim to cut the nonoil-trade deficit.
The central bank expects Ecuador’s gross domestic product to have expanded about 4% last year.
Credit: The Wall Street Journal; www.wsj.com