Colombia retaliated swiftly against Ecuador on January 22, imposing matching trade penalties and cutting off electricity supplies a day after Quito announced a 30% “security charge” on Colombian imports, stoking a diplomatic standoff that threatens economic ties between the Andean neighbours.

Bogotá announced it would apply a 30% levy to 20 categories of Ecuadorean goods, describing the response as temporary and subject to review whilst leaving room for diplomatic resolution. The Colombian commerce and industry ministry said the measure was designed to restore balance in trade relations following Ecuador's unilateral decision.

In a parallel move, Colombia's energy ministry terminated electricity sales to Ecuador, citing the need to safeguard domestic power availability during periods of climatic uncertainty. Officials said cross-border energy flows would only restart once suitable technical and trade conditions were restored.

The reaction came after Ecuador's President Daniel Noboa announced on January 21 his country would slap a 30% security levy on Colombian imports from February 1, citing an annual trade deficit exceeding $1bn and what he described as inadequate cooperation in tackling drug trafficking and illegal mining along the shared frontier.

Noboa's rationale closely mirrors US President Donald Trump's justification for imposing tariffs on Mexico and other nations over drug smuggling, trade deficits and border security concerns.

Ecuador has emerged as a major cocaine trafficking corridor in recent years, despite neighbouring Colombia remaining the world's largest producer of the drug. Criminal organisations have increasingly used Ecuadorean ports to ship Colombian cocaine to international markets, fuelling a surge in violence that prompted Noboa to declare an "internal armed conflict" last year. The cross-border dynamics have hindered bilateral security cooperation, with each government blaming the other for insufficient action against trafficking networks.

Colombian President Gustavo Petro pushed back against Ecuador’s accusations, pointing to the seizure of 200 tonnes of cocaine in border zones and involvement in hundreds of counter-narcotics operations alongside Ecuadorean forces.

"I hope Ecuador has been grateful, when they have needed us, that we have acted energetically in solidarity," Petro wrote on X, offering to broaden joint action against fentanyl trafficking.

Colombian Energy Minister Edwin Palma called Ecuador's initial move "economic aggression" that undermines regional integration, noting Colombia had supplied electricity to Ecuador during domestic drought periods, at times exceeding 450 megawatts. According to Reuters, Palma ordered the dismantling of a recent initiative allowing private firms to participate in cross-border energy sales.

Colombia is one of Ecuador's main suppliers of industrial goods, food and consumer products, making the bilateral trade relationship crucial for both economies. Business groups in Colombia warned of potential damage to exports, with several sectors including vehicles, pharmaceuticals, sugars and oils relying on Ecuador for more than 10% of their overseas sales, according to economic research institute Anif. Business sectors in both countries have voiced concern that the measures could drive up consumer prices, disrupt supply chains and undermine investment stability.

The dispute raises questions under the Andean Community's Cartagena Agreement, which restricts tariffs on intra-bloc trade except under narrowly defined security exceptions. Colombia said it remained open to dialogue whilst assessing options under regional trade mechanisms.