Technical measures for trade in Central America: incidence, effects on prices and consumer welfare

Despite the tariff reductions generated by the Dominican Republic-Central America Free Trade Agreement, obstacles persist at the region's borders, affecting regional trade. This study uses recent data to quantify the incidence of sanitary and phytosanitary measures and technical barriers to trade, comparing them globally. Although the Central American region has the lowest prevalence of non-tariff technical measures in the world, there is significant heterogeneity among countries. It is estimated that the impact of these measures on prices is equivalent to an ad valorem tariff of 11.6%. Looking specifically at beef, chicken, bread and dairy products in Guatemala, the impact is projected to be equivalent to ad valorem tariffs of 68.4%, 51.4%, 22.0% and 5.0%, respectively. Simplifying key sanitary and phytosanitary measures could reduce the urban extreme poverty rate in Guatemala from 5.07% to 4.91%.