Analytical Note, May 2009

Analysis of the Draft Interim Trade Sustainability Impact Assessment (TSIA) of the EU-Central America FTA.

Currently, the EU and Central American countries are negotiating the Free Trade Agreement. The European Commission commissioned a Trade Sustainability Impact Assessment (TSIA) which is estimated to be completed by August 2009. On 6 April 2009, the draft interim technical report was published (in English). This paper assesses the draft interim TSIA and its annexes.

The main conclusions are; main sustainability issues in Central America identified in the report are not sufficiently addressed such as regional integration (economic), unemployment (social) and deforestation (environmental); the results of the CGE model, and the data input and scenarios overstate the benefits of the FTA; the conclusions of the TSIA are not always supported by the results; sensitivities in areas such as sugar and coffee are ignored through aggregation of sectors, e.g. into “other agriculture” or “processed foods/beverages and tobacco”.

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