European Union External Action

Ecuador and the European Union

At the bilateral level, Ecuadorian and EU authorities hold a High Level Political Dialogue once a year, which allows high-level officials to exchange ideas to strengthen and deepen bilateral relations and develop a political and cooperation agenda.

The third meeting of this mechanism took place on 24 November 2016 in Brussels. The dialogue focused on a number of important issues, including migration, refugees, cooperation, human rights and governance, environmental management and climate change. Regarding climate change, the parties addressed multilateral cooperation in the follow-up to the UNFCCC Conferences in Paris and Marrakech, as well as the implementation of the 2030 Agenda for Sustainable Development and the fight against drug trafficking.

The dialogue also falls within the broader framework of regional relations between the EU and the Community of Latin American and Caribbean States (CELAC), of which Ecuador is a member. This dialogue has led to a qualitative advance in the depth and scope of the relations between both parties, including new areas, such as the fight against illicit drugs, regional integration and the promotion of sustainable development. The EU-CELAC Summit takes place once every two years at the level of Heads of State or Government: the last Summit took place in Brussels in 2015 and the following one will be in San Salvador  in 2017. (More information http://celacinternational.org/)

 

Trade Agreement

On 1 January 2017, the Multiparty Trade Agreement between Ecuador and the European Union came into force, replacing the previous GSP+ system of tariff preferences. The Trade Agreement is a landmark in bilateral relations between the EU and Ecuador. It grants important tariff concessions to agriculture and liberalizes 100 percent of industrial and fishing products for Ecuador, while the European Union will also enjoy tariff benefits, but in a variable period of up to 17 years, recognizing the asymmetry in the parties´ development levels. The markets for services, financial and public procurement will be opened gradually to avoid any negative impacts on each parties´ economies. The Trade Agreement also guarantees capital movements and investments.

The Agreement establishes a long-term, stable and transparent legal framework with clear rules, providing greater predictability for economic operators and investors. The Agreement will therefore increase the transfer of technology and innovation that Ecuador needs, creating a much more favourable business climate for investments and opportunities of new commercial activities. Similarly, increased trade between the parties should generate employment and have a positive impact on poverty reduction.

It is important to highlight that with the Trade Agreement, Ecuador and the European Union have become equal and privileged partners. Trade relations are now guided by best practices agreed on at the international level, while ensuring a transparent environment where national treatment prevails without discrimination between the two parties. Thus, the Agreement includes mechanisms to address a range of issues, such as barriers to trade, sanitary and phytosanitary measures, as well as trade defence and dispute settlement mechanisms.

It should also be noted that the Agreement contains a chapter on trade and sustainable development. The parties pledged to strengthen the economic and social development of their populations, not only by complying with the labour and environmental legislation of each party, but also by adopting international environmental and labour protection standards.

It is also important to mention that the impacts of the Agreement in the labour and environmental fields will be monitored and evaluated through consultations with civil society.

Please find here the full text of the Multiparty Trade Agreement: Official Register L 356 .

 

Over the past decade, the trade flow between Ecuador and the EU has been positive,  with a significant increase in commercial transactions between the two parties. In recent years, the European Union has become one of Ecuador's most important trade partners for non-oil exports, as well as a key market for the products of micro, small and medium-sized enterprises (SMEs) and for actors of the popular and solidary economy (AEPYS). Ecuador's exports to the EU have grown 63 percent in part due to the tariff preferences obtained through the generalized system of preferences, GSP+, which benefited 85 percent of its exports, a helped maintain a trade surplus.

In 2016, trade between Ecuador and the EU reached over 4.5 billion Euros, placing the EU as Ecuador's second trading partner, accounting for 13.2 percent of its trade with the world:

  • Since 2006, the number of commercial transactions between the two parties has increased by 63 percent;
  • In 2015, Ecuador exported goods worth 2.5 billion Euros to the EU, while imports to Ecuador from the EU were just over 2 billion Euros;
  • 97% of European imports from Ecuador are primary products such as bananas, shrimp, cacao, tuna, coffee, and roses. The main export products from the EU to Ecuador were mechanical and electrical machinery, pharmaceuticals, medical and dental instruments, paper, and vehicles;
  • Ecuador's trade deficit with the EU decreased 36 percent since 2011. The country now maintains a trade surplus with the EU.

 

As a high-middle-income country, Ecuador, in principle, would no longer qualify for EU bilateral development cooperation. In view of persistent inequality in the country, in 2014, the EU and Ecuador agreed to continue bilateral EU development assistance in the country for an additional period.

The objective of the Multi-annual Indicative Programme 2014-2017, which has a budget of 67 million Euros, is to consolidate the achievements of the ongoing cooperation and address development challenges in the country´s poorest regions.

EU cooperation in Ecuador supports the Government's efforts to diversify the country's economy and to promote sustainable trade with a focus on two main lines of action:

  • Support for sustainable and inclusive growth at the local level.
  • Promotion of sustainable trade.

Ecuador also participates in all EU-Latin America regional and thematic programmes and benefits from the Support Instruments to address priorities such as human rights, education, innovation, environment, climate change, and the fight against drugs.

South America is one of the most vulnerable regions in the world to natural disasters. Bolivia, Colombia, Ecuador, Paraguay, Peru, and Venezuela are highly exposed to earthquakes, floods, landslides, droughts, cold waves, and volcanic eruptions. Local capacity to deal with such disasters has significantly improved over the past years, but continues to be limited.

The European Commission's assistance to South America, which is channelled through the Directorate General for Humanitarian Aid and Civil Protection – ECHO and implemented by our partner UN Agencies, NGOs and Red Cross, focuses on providing emergency response to natural disasters and to prepare communities for future catastrophes by increasing the resilience and preparedness of the most affected populations and local institutions responsible for disaster management.

The EU immediately responded to the needs of the people affected by the 16 April 2016 earthquake by disbursing 5 million Euros to assist the most vulnerable victims. Besides complementing the government's efforts to address this disaster, our humanitarian partners focused their assistance in difficult-to-access rural and suburban areas through a comprehensive response strategy that initially included support for humanitarian coordination, food aid, water and sanitation. These efforts were complemented by emergency housing, the distribution of water and sanitation facilities, and disaster preparedness and livelihood recovery. In all these areas of intervention and in adherence to ECHO's policies for a quality response, ECHO´s humanitarian response has focused on protecting the most vulnerable groups.  

Following the 16 April Earthquake, the EU Civil Protection Mechanism was also activated at the request of the Ecuadorian authorities and the United Nations, providing urban search and rescue teams, experts in damage assessment, water, and sanitation. In addition to food, the EU sent equipment such as water purifiers and electric generators, blankets, hygiene and health kits to contribute to the relief efforts. The assistance was generously offered by Austria, Belgium, Denmark, France, Italy, Portugal, Spain, Switzerland, the Netherlands and the United Kingdom, and coordinated by the European Commission Emergency Response Coordination Centre (ERCC).

However, humanitarian aid should not only assist the victims of crises once crises occur, but also help reduce the negative impact of disasters through disaster risk reduction. Through the Disaster Preparedness Programme (DIPECHO), financed in Ecuador to the amount of 14.5 million Euros since 1996, the EU has helped the most vulnerable populations to improve their capacities to deal with these phenomena.

For 2017-2018, ECHO's Natural Disaster Preparedness Program (DIPECHO) aims to reduce the vulnerability of people at risk by strengthening capacities to respond to natural disasters at a national and local level through the following actions:

  • Capacity building in communities;
  • Strengthening national and local institutions;
  • Inter-institutional coordination at the local, national and regional levels;
  • Strengthen knowledge on disaster risk reduction through improved methodologies, guides, and other tools.

 

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