What Happened
Costa Rica’s new president, Laura Fernández, has made the trade dispute with Panama one of the first issues of her administration, saying she will push direct talks with President José Raúl Mulino to remove restrictions affecting Costa Rican agricultural products in the Panamanian market.
In comments to Telemetro Reporta, Fernández said she will not allow the curbs on Costa Rican dairy, meat and other agro-industrial products to continue. She framed the dispute as a matter of fair trade and long-standing regional cooperation between the two countries.
The Trade Dispute
The conflict began after Costa Rica suspended sanitary certifications for several Panamanian plants in the meat, dairy and poultry sectors that exported to the Costa Rican market. Among the affected companies were Grupo Melo, Grupo Carnes de Coclé, Grupo Mangravita, Nestlé and Prolacsa.
Panama responded by restricting access for Costa Rican dairy, meat and agricultural plants under sanitary and production-protection criteria during the administration of former president Laurentino Cortizo. The dispute has since become a broader test of how both governments apply health rules in cross-border trade.
Why It Matters
The bilateral exchange between Panama and Costa Rica exceeds $1 billion a year and covers food products, pharmaceuticals, medical devices and logistics services. That makes the dispute economically important for producers, exporters and consumers on both sides of the border.
Costa Rica took the matter to the World Trade Organization, arguing that Panama’s restrictions violated international trade rules. A panel under the WTO dispute settlement mechanism ruled in Costa Rica’s favor, but Panama appealed the decision, leaving the case without a final resolution.
As the dispute continues, 26 Costa Rican plants remain barred from the Panamanian market, while at least eight Panamanian plants remain suspended from exporting to Costa Rica.
Panama’s Response
Panama maintains that its measures were not arbitrary. The government says they were sanitary and phytosanitary decisions aimed at protecting the national agricultural system and ensuring equivalent controls for both countries.
After Fernández’s remarks, Panama’s Commerce Minister Julio Moltó responded on X, saying that as a WTO member Panama has the same rights as other countries and is exercising those rights. He also said Panamanian producers deserve the same respect as their Costa Rican counterparts and reaffirmed Panama’s willingness to discuss rules that apply equally to both sides.
Moltó has repeatedly argued that Panama wants clear rules for both countries so that companies can compete under the same sanitary and commercial conditions. Following meetings between Mulino and former Costa Rican president Rodrigo Chaves, both governments had already agreed to open talks in an effort to resolve the conflict without prolonging the international legal process.