Wednesday, March 22

China and Ecuador began negotiating a free trade agreement

China and Ecuador began negotiating a free trade agreement after an agreement reached in Beijing, during a visit by Ecuadorian President Guillermo Lasso that concluded on Saturday, Foreign Trade Minister Julio José Prado said.

Representatives of the ministries of the branch signed a memorandum of understanding after concluding a joint feasibility study on the possibility of reaching the agreement, Prado said at a virtual press conference from Beijing after the president completed his agenda.

“The parties officially begin the negotiation of the treaty,” he said. “We estimate” that the talks could end by the end of this year, he added.

The last round of negotiations could take place in the China-Lac of 2022, the main business meeting of the Asian country with Latin America and the Caribbean, which will take place in the Ecuadorian port of Guayaquil (southwest) next November.

For Ecuador, the possibility of expanding its export market by 1,000 million dollars a year opens up.

China is one of Ecuador’s main trading partners, along with the United States and neighboring Colombia.

Between January and November 2021, sales of Ecuadorian products to the Chinese market totaled 4,593 million dollars and purchases 3,261 million, according to the most recent data from the local Central Bank.

Ecuador also promoted negotiations with China to extend the terms of payment of its external liabilities, for some 5,200 million of the total of almost 46,936 million dollars (44.5% of GDP).

In a joint statement between the foreign ministries of the two nations, the Chinese government expressed its willingness to carry out “friendly negotiations” on the debt, said the Ecuadorian Minister of Foreign Affairs, Juan Carlos Holguín.

“I am very optimistic about what we can achieve in terms of debt renegotiation,” Lasso said after a dialogue with Chinese President Xi Jinping.

“We agreed that until October 2022 we will be ready to sign the Free Trade Agreement,” he added, in statements released by the presidential headquarters.

About 2,100 million dollars of what Quito owes are committed to paying with crude oil. Lasso proposed “disassociating the oil brokerage that exists from third parties from debt instruments” to achieve savings of 400 million a year by having a direct relationship, the official pointed out.

Beijing is Quito’s largest creditor in terms of debt between countries, with 12% of the total.