Mercosur faces “great problems and internal divisions” making talks with EU “difficult”
French Foreign Trade minister Nicole Bricq said that there are “great problems” in the current negotiations between the EU and Mercosur to reach an association agreement which also includes a free trade chapter.
“There are great problems because Mercosur is very much divided among its member countries” said Minister Bricq during a press conference in Brussels, where she met with several EC commissars linked to trade and Vital Moreira, chairman of the International Trade Committee from the European Parliament.
Asked specifically about negotiations with Mercosur and the last round of talks in March when not much was advanced, Bricq said that Foreign Trade Commissar Karel De Gutch and Internal Trade Commissar Michel Barnier updated the group on the issue.
“The agreement has become problematic…there are many problems including inside the Mercosur organization”, said the French minister.
Bricq recalled that a new member has been incorporated to Mercosur, Venezuela, besides Argentina, Brazil, Uruguay and Paraguay which was suspended by its associates at the end of June, until next year, following the removal by Congress of Fernando Lugo, as president of the country.
De Gucht said recently that EC will continue to negotiate with Mercosur as a block and expects Venezuela, a full member since 31 July, will take part in the talks with the EC.
Bricq also pointed out to other obstacles for negotiations; the “measures clearly protectionist which are implemented by certain Mercosur members”, and referred specifically at the problems created with bio-diesel.
The EC last week decided to open an investigation following a presentation last July by the Bio-diesel European Council which considers imports of Argentine bio-diesel as dumping (because sale price to EU is below domestic price) and are therefore causing damage to the local European bio-diesel industry.
France is also one of the countries which has most warned about the potential damages to the European agriculture production (particularly beef) which an agreement with Mercosur could entail, since Brazil, Uruguay and Argentina are world leaders in the production of beef.
EC is waiting for the next round of negotiations to reach the association agreement with Mercosur and which was scheduled for last July but had to be postponed because of the political situation in Paraguay. Apparently some time late this month delegates from the EU and Mercosur will meet to continue advancing.
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Argentina's special situation is such that domestic prices are artificially high in order to maximise materials going overseas to bring in foreign money to a country seriously short of cash.
Though this is not 'classic dumping' (a la Chinese model) the effects are the same if it damages domestic production of the same products in the EU.
However, this is a much lesser problem than
(i) the general unravelling of Mercosur as a coherent trading body, and (ii) Mercosur states' widespread protectionisms, and
(iii) its immediate transformation by Chavez into a political organisation.
This is not a supra-national organisation - in its present state - with which it is safe to deal.
Desunion I find in Europe, talk, talk, talk, and still cant resolve the crisis that Greeece is recued, not rescued, that Spain is rescued, not rescued, Italy, Portugal, etc, etc.....
Such is the nature of supra-national organisations - just look at the United Nations!
In Mercosur, there is a commonality of trade barriers, not a disunity.
There is a unified, though unwritten and undeclared, agreement to operate as independent nations.
And there is a unified vision of the superiority of politics over trade.
Unity or disunity, not a great place to do business at the moment.
Ha, ha, ha to the power google!
As Uruguayan and defender of free trade, explain to me; How can Europe be in the right when they deny therir own citizens the best meat in the world and cherap bio-diesel just so they can uphold their prices, and at the same time affect your own country, restricting the market?
Or you are a defender of their free trade,, mayhap, not our?
i do want to ask him a good question .
Sure, but what do you think of EU's protectionism?
Remember that this is something that happens and has done so since before 2004, it's not a recent action from the EU.
South America = Brazil.
Then, with those rules to begin with, do you think it is fair we should buy their stuff cheap, affecting our own production (non-existant for those very same reasons), all while they refuse to let our quality products in their market? Is Argentina in the wrong? Or should we all just comply and complain at the WTO?
You seem to be the expert on this topic. It is always nice to see people on the forum who know what they are talking about.
How much of a hindrance is the EU CAP to South American exporters.
When I look at the numbers for Chile, it seems that we are exporting massive amounts of fruit to Europe and I don’t see much of anything from Europe here at all.
To me this would mean the Argie complaints are lots of hot air and not much substance. Is this so?
So you mean we should get on with our business as usual, buy their stuff cheap, and accept their restrictions on our quality products?
What are the restrictions on Uruguayan produce and what is the stuff you buy cheap?
Europe doesn't sell much to Chile, partly becasue European goods are NOT cheap. I wish they were.
Putting Arg to one side, how much of a problem are the EU restrictions for Uruguay? Rising food prices must reflect rising demand, so is the intelligent solution not to negotiate as many trade agreements as possible around the world and export to where is most convenient. This is what Chile has been doing.
From what I see, our food exports increase year on year so what is all the fuss about?
So you also think that we should disregard the EU protectionism of our quality products and concentrate on other markets? Is your “free and fair” trade for EU only?
I am not saying disregard protectionism, I am saying work towards better agreements whilst looking for better customers.
I run my own business, when I think a customer is unreasonable I try my best to meet them half way but I don’t cry about it. The key is making sure you have quality on your side then you will always have a market.
If the EU doesn’t want your quality product, that is their loss.
Don't play the “people didn't choose so”-card, as the EU citizens didn't choose so either...
Condorito I am a farmer and will surely be branded by Guzz as one of those nasty oligarchs who grind the ]faces of the starving poor from henceforward. Not so. I am a working stiff trying to make a living off the land.
Cheap imports from Europe? Where apart from whisky in the free shops?
If Europe doesnt want our beef bad cess to them. Ther are other markets if you go and look for them as Chile has done
I think INAC has recently sponsonsed restaurants for Uruguayan beef in Portugal, China, California and New York. Money well spent I think
Is it the case the EU doesn’t want URG beef or are there quotas in place?
I am glad the INAC has taken the initiative to promote your products around the world.
Guzz,
I agree. If MS didn't want EU products that would be their loss.
Anyhow, it is not the case that the EU doesn't import food. Like I said, we export loads of it to them so the restrictions can't be that hard to work with.
What is the “people didn't choose so”-card?
I would not judge you for what you do for a living. The farmers are the core workers of all societies, as food is a constant demand.
Why would that make you an oligarch? Are you a terrateniente that abuses underpaid staff? I don't think so, not today.
Although I must admit that the vastness of the unused soil in Uruguay is great, and if you are a landowner that only uses the land for speculation and no production, you could fall into my box of loosly classified oligarchs :)
The problem is EU's protectionism, lets talk about that. It's far older than any measure taken by any Mercosur member, and a problem that should be adressed accordingly.
You say the problem is EU protectionism. Is there any estimate of how much damage this does to the URG economy?
Uruguayan beef would “sell like butter”, like the Swedes say, in Europe. It does already, but as exclusive meat, not available for the broad masses.
Matter of fact, our meat export in the 50's was, together with the banking system, what made Uruguay the wealthy country it once was.
Plenty of adandoned frigorificas as historic evidence...
Is it limited by quota?
seattletimes.com/html/nationworld/2019064782_apltargentinarussiagas.html
Yes condorito there are Hilton quotas to EU for lamb and beef. Uruguay fulfills its quota if convenient. Argentina never has so it loses part of its unfulfilled quota to us if we want it. If not we have other markets. Guzz complains that Uru beef is not available to the average consumer in EU. Well we sell a top quality product and if the man in the street cant afford it, to quote Marie Antoinette , let em eat cake!
We have a wool coop here owned by the producers CLU. It doesnt matter if you send in 10 fleeces or 1,000 all are socios in the business. Just lately wool production is way down and not enough to keep the plant and its employees going full time. So what have they done? Imported wool for processing into tops for export from Argentina and dare I say it the Falkland Islands, Good business for Uruguay and the employees at the plant I think
“It doesn't matter .. , as Mercosur trades as a unit.”
I am sure that you don't really believe this.
Bilateral agreements with countries beyond Mercosur,
and hundreds of internal barriers to trade within Mercosur.
Mercosur has ground to a halt BECAUSE it does not trade as a unit.
@5 Indeed you are!
@9 “the best meat in the world”? Filled with all those nasty “veterinary drugs” banned in Europe and the US?
@12 Is Germany going to “break” the EU? I think not. It's the only thing that allows Germany to sell its goods abroad. Otherwise, they would be too expensive.
@13 As long as we keep S. Am. crap out!
@16 You can't have argieland and quality in the same comment. They don't go together.
@21 Nobody in their right mind would buy S. Am. meat!
@28 It's easy to understand. Never buy vital products from an enemy. Most of LatAm is an enemy of Europe. Particularly the UK.
@34 No, they aren't. The majority of British consumers will not purchase LatAm goods.
@36 That's good! Over here, not a day goes by without my encouragement of fellow UK consumers to boycott anything originating in LatAm. Fortunately, LatAm farming, manufacturing and trade practices are very helpful. Keep it up! I'm on safe ground. Consumer health, high quality goods, fairness, honesty and keeping to agreements are, it is known, low on your agenda.
Thanks for the info.
It seems then, that Chile has no problem exporting food to Europe, Uruguay is doing a good job too and Argentina is failing to even use their beef quota, yet they are the ones kicking up the big fuss.
In conclusion, Argentina making a big fuss on the world stage without much justification. The histrionics are most likely for domestic consumption...”look at me taking on the world”...rather than working towards practical solutions.
Conquito
I am glad that only “Most of LatAm is an enemy of Europe”, there is some hope then.
Re GeoffWard2 @36: “Consumer health, high quality goods, fairness, honesty and keeping to agreements are, it is known, low on your agenda.”
How do you know these things are low on my agenda?
I think you might be getting a bit mixed up.
dailyreckoning.com/the-;unfortunate-state-of -the -argentine-beef-industry
Unhappy days for Argie beef farmers then.
Sounds like EU quotas are the least of their problems.
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