Costa Rica Newest Member in Central American Free-Trade Club
After years of debate, Costa Rica became the last signatory country to join to the Dominican Republic–Central American Free Trade Agreement.
The other six DR-CAFTA countries—the United States, Guatemala, Nicaragua, El Salvador, Honduras and the Dominican Republic—have all been on board, starting last year.
All the other member countries left it up to their legislative and congressional agencies to approve the free-trade pact. In the United States, the accord barely won approval in the House of Representatives with a 217–215 vote on July 27, 2005. The U.S. Senate had approved it a month earlier on a 54–45 vote.
But Costa Rica decided to let the people vote on the idea. In an Oct. 7 referendum, the free-trade pact was approved by 52 percent of the voters.
That means most goods and services traded between the DR-CAFTA countries will enter duty- and quota-free.
For the apparel industry, DR-CAFTA has helped the region remain a key supplier to the United States of clothing, particularly T-shirts, knit tops and underwear.
Large stores, including Target Inc., Wal-Mart Stores Inc., and Kohl’s, do a considerable amount of sourcing in that region as well as underwear makers such as Fruit of the Loom and Hanesbrands Inc.—Deborah Belgum
