Textile tariff dispute between Panama and Colombia awaits arbitration

Regarding the case of Panama accusing Colombia of improper tariffs and trade barriers on imports of textiles and footwear, the two countries will continue to have verbal arguments at the World Trade Organization (WTO) on August 29, 2014. Representatives from Panama Ambassador Felipe Suescun is expected to argue that Colombia’s argument will emphasize that products subject to higher tariffs are only transshipped in Panama’s Colon Free Zone and are not originating in Panama.
Since March 1, 2013, Colombia has levied compound import tariffs on textiles and footwear from countries that have not signed a free trade agreement (FTA) with Colombia.
The Colombian authorities stated that the measure was to combat unfair competition practices such as smuggling and underreporting of commercial invoices. However, Panama believed that the tariff measure exceeded the regulations of the World Trade Organization (WTO) and seriously affected the Panama Colon Free Zone (CFZ). Regarding the rights of manufacturers, Panama officially reported Colombia’s inappropriate tariff barriers to the WTO in June 2013.
The dispute between the two countries is expected to eventually move to arbitration. The entire process is expected to take more than one and a half years to complete, starting from June 2013, when Panama filed a complaint.