Ecuador will cancel a 21-percent tariff on imports from Colombia by the end of the month, the Colombian trade ministry said late on Wednesday, reversing an effort to shield its economy from an influx of cheap goods.
Ecuador, which has been hit by the steep drop in the price of oil, its biggest export, imposed tariffs on imports from Colombia and Peru in January as a result of depreciating currencies in those two nations that made their products cheaper.
"In accordance with the commitment made by the Ecuadorian government, the measure will cease to be valid on February 27 at the latest," the Colombian Ministry of Trade, Industry and Tourism said in a statement.
The deal was confirmed by Ecuador's commerce minister, who said his country would be negotiating a similar arrangement with Peru in the coming days, in a bid to "safeguard national industry."
Ecuador, the smallest member of OPEC, had also levied a 7 percent duty on imports from Peru.
Ecuador, which uses the U.S. dollar as its currency, had said it wanted to protect its trade sector from weakened currencies in the region. Colombia's currency softened by 17 percent during the last twelve months, while Peru's sol recently slipped to a five-year low.
(Reporting by Julia Symmes Cobb and Nelson Bocanegra; Additional reporting by Alexandra Valencia; Editing by Jeffrey Benkoe and Bernadette Baum)