> You seem to be assuming that if the US doesn't buy those flowers then no one will and they'll just rot. That seems unlikely.
At the margin, it seems incredibly likely. You don't cut yourself off from the largest wealthiest market in the hemisphere and continue to sell exactly as many flowers as before at exactly as high a price...
Obviously we don't know the details of the agreement so we can't actually know much of anything. Presumably the government itself isn't buying the flowers so I'd assume its more of free trade kind of deal so no tariffs or lesser tariffs are imposed on Ecuadorean imports.
The removal of the agreement wouldn't then be embargo/sanctions, it would mean normally trade that other countries conduct with the US. So the price for US importers would increase and so at the margin as you rightly point out there would be some loss of profit and some loss of sales. We don't know how much though, and we don't know if those could be replaced by other purchasers and if so at at what price reduction.
In any event it wouldn't be a loss of $23m a realistic estimate might be closer to 10% of that so around $2-3m. For a country with $5bn in oil exports that's chump change and given that its a leftist government any local workers that suffer will probably be have a decent social safety net in place until they get back on their feet.
> In any event it wouldn't be a loss of $23m a realistic estimate might be closer to 10% of that so around $2-3m.
? Where are you getting this $23m from? The article says that they export to the USA "$166 million of cut flowers". 10% of that would be $16.6 million, not $2 million...
In a cheeky jab at the U.S. spying program that Snowden unveiled through leaks to the media, the South American nation offered $23 million per year to finance human rights training.
The funding would be destined to help "avoid violations of privacy, torture and other actions that are denigrating to humanity," Alvarado said. He said the amount was the equivalent of what Ecuador gained each year from the trade benefits.
Correct, on re-reading the article the $23m is the value offered for HR training, which is apparently somehow equivalent to the value of the economic benefit Ecuador gains from the agreement - so presumably they already did the relevant math to get to that number.
I'm not sure the $23m applies only to the flower industry - it reads like it applies to the value of the total agreement to Ecuador. - I do mention upthread that without actually knowing the details of the agreement we're all just speculating.
But you asked where I got $23m from... and the answer was the article.
and my larger point still stands anyway... Ecuador apparently sell $5 billion in oil to the US... BILLION not million. A loss of $23million is still chump change. A loss of $230m probably wouldn't affect much.
At the margin, it seems incredibly likely. You don't cut yourself off from the largest wealthiest market in the hemisphere and continue to sell exactly as many flowers as before at exactly as high a price...