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Consolidation of the Customs Union between Guatemala and Honduras

By Federico Mazzella ,
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The two countries are seeking to consolidate a single customs area that covers 44% of the total area of Central America so as to create a more attractive market for local, regional, and foreign investors.

On June 6, 2016, ministers and authorities from Guatemala and Honduras signed the documents that formally established the ministerial body that would be responsible for managing, implementing, and perfecting the customs union between the two countries.

This institution will define and adopt the general policies, directives, and legal instruments that will form the basis for the customs union. The ministerial body will be made up of Guatemala’s minister of the economy, Rubén Morales Monroy, and Honduras’s secretary of state for economic development, Arnaldo Castillo.

At the meeting, the operating regulations for the ministerial body and the regulations for the structure and investment fund were passed.

The customs union is governed by the Enabling Protocol for the Process of Deep Integration Toward the Free Movement of Legal Persons and Goods between the Republics of Guatemala and Honduras, which came fully into force on May 13, 2016.

Guatemala and Honduras have been working toward the implementation of a binational customs union since December 3, 2014, following a presidential mandate to do so and with technical and administrative support from SIECA (link in Spanish). The Enabling Protocol was passed by the congresses of Guatemala and Honduras on January 21, 2016, and December 8, 2015, respectively.

This union between Guatemala and Honduras has consolidated a customs area that includes 53% of the region’s population (24.12 million) and 35% of its GDP (US$72.78 billion). Furthermore, half of the region’s sea freight goes through these two countries.

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