Ecuador is the fourth Latin American country to sign an free trade agreement with China, after Chile, Peru and Costa Rica.
On Wednesday night, China's Commerce Minister Wang Wentao and Ecuador's Production Minister Julio Prado signed a Free Trade Agreement (FTA) after a year of negotiation.
This bilateral deal will allow 50 percent of Ecuador's exportable supply to be immediately released from tariffs for entry into China. In the course of the next 10 years, 99.6 percent of Ecuadorian products will be completely tax-free.
Among the main Ecuadorian export products are tuna and sardines, which will have immediate tax relief for their entry into China. Ecuadorian roses and cacao will be completely tax-free in five years, while shrimp and bananas will be tax-free in ten years.
To protect local industries from Chinese products, the FTA defines 828 goods as "highly sensitive." Among them are flat ceramics, wooden boards, textiles, and iron wire.
The FTA needs to be approved and ratified by the Ecuadorean Constitutional Court and the National Assembly before taking effect. In the meantime, exporters hailed the deal.
"The size of the Chinese market will allow us to leverage exports much more," especially as China's economy has proven resilient, expanding despite the challenging global landscape, according to Xavier Rosero, vice president of the Ecuadorian Federation of Exporters.
Ecuador is the fourth Latin American country to sign an free trade agreement with China, after Chile, Peru and Costa Rica. Currently, China is Ecuador's second-largest trading partner.
In 2022, the two countries witnessed double-digit growth in trade for the second year in a row, with bilateral trade reaching US$13 billion, up 19.7 percent year on year.