Saturday, March 22nd 2014 - 07:31 UTC

Mercosur and EU in another effort to advance in the long delayed trade agreement

Mercosur and European Union chief negotiators met on Friday in Brussels to define if conditions are ready for the exchange of tariffs reductions proposals with the purpose of reaching an ambitious trade agreement which was started back in 1999 and has yet to mature.

Argentina has been dragging its feet, but this week in France President Cristina Fernandez made encouraging statements

 This last round of negotiations which was launched in 2010 was supposed to be concluded at the end of last year but problems on both sides delayed the talks particularly since Argentina has had a more restrictive approach and has been dragging its feet as its current policy is to promote local manufacturing and the domestic market.

However a week ago under strong pressure from Brazil, the situation was unlocked and apparently Argentina will be part of the joint proposal to be presented to the EU counterparts when the time comes.

This was confirmed by Brazil's Minister of Industry Mauro Borges following his visit to Buenos Aires on Friday 14 March, and by encouraging statements from President Cristina Fernandez herself when the joint press conference with French president Francois Hollande in Paris on Wednesday.

But the big question involves the degree of harmonized 'concessions' that can be expected from Mercosur countries, since Brazil, Uruguay and Paraguay are prepared for an ambitious presentation, in accordance to what was mentioned back in 2010, that is the elimination of tariffs for 90% of all goods and services.

On the EU side the agriculture issue remains a highly sensitive one for several leading countries and is the point on which Mercosur insists particularly. “Cohesion” on both sides remains a clue word.

Nevertheless in Brussels what was addressed and hopefully agreed are the parameters for the proposals, including the possibility of a tentative calendar for the definitive exchange of such proposals, and even when so many countries are involved it won't be easy, April/May is considered a good chance.

Likewise the EU has repeatedly pointed out that its proposal much depends on Mercosur, in so far that Argentina is included in the package, which means the Mercosur proposal is one, and shared by all four members in the negotiations.

So far it is clear that Brazil and Uruguay are the more ambitious and prepared to concede the most in tariffs, and at one point several options at 'different speeds' were considered, so as to contemplate Argentina's reluctance or slower pace in elaborating its 'modest' proposal.

Brazil and Uruguay (and Argentina) are also urged since as of last January first, the three have been categorized (by the World Bank) as high middle class countries, meaning they have lost some EU tariff benefits they enjoyed.

In the case of Uruguay several items such as equine meat; fresh fish; hake; mandarin and citrus; plywood; skins; canned fish; mollusks, among others have been dropped from the list of preferential tariffs.

16 comments Feed

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1 Conqueror (#) Mar 22nd, 2014 - 09:57 am Report abuse
I still can't understand why Europeans would want such an agreement. Nor how it would work. Mercosur countries can't even act co-operatively between each other. Leaving aside what was done to Paraguay, look at how argieland treats Uruguay. What happens when a series of British-flagged vessels turn up to discharge and/or load cargo at a “mercosur” port? And how could Brazilian “political advisors” not be aware of argieland's trade blockade? Is argieland going to try to use an EU/mercosur trade agreement to inhibit trade with the Falklands? How is it going to handle the Falklands status vis a vis the EU? What has mercosur got that the EU REALLY needs? Just drop it. Just tell 'em there might be further talks when they reach the mid-20th century!
2 Klingon (#) Mar 22nd, 2014 - 11:50 am Report abuse
Brazil finds out: It's hard to fly with the Eagles when you are surrounded by Turkeys!
3 Briton (#) Mar 22nd, 2014 - 07:01 pm Report abuse
It just my opinion but,
If the unmighty EU gravy train wishes to advance rapidly, then it should in all fairness drop Argentina and leave CFK standing at the station,

As previously stated, why they wish to enter into trade deals with some of them is mystifying at this stage,
But then, where theirs money to be made, they would trade with the devil, would they not..

.
4 ilsen (#) Mar 22nd, 2014 - 07:40 pm Report abuse
What happened to the MercoSur conference due to take place in Caracas this month?

Any news on this?
5 golfcronie (#) Mar 22nd, 2014 - 07:56 pm Report abuse
Do not think that the EU will enter into an agreement with Mercosur, France will be vetoeing any discussions as regards the common agricultural policy as they have preferencial treatment. Argentine has only Soy and Wheat to sell.
6 JoseAngeldeMonterrey (#) Mar 23rd, 2014 - 11:58 am Report abuse
A Mercosur-EU agreement will be good for the region, but only if the Mercosur countries do respect said agreement. They have a bad record when it comes to respecting trade agreements. As soon as the EU-Mercosur agreement begins to show a trade surplus for the Europeans and a deficit for Brazil or Argentina, there will be problems, they will begin imposing tariffs an quotas. But the real problem for a Mercosur-EU trade agreement lies in the dysfunctional economies of the Mercosur members.
7 ilsen (#) Mar 23rd, 2014 - 01:16 pm Report abuse
@6

You make some very good points there.
Also don't forget that Venezuela is a member and a dictatorship, as well as an Economic basket case.
How will that fit with EU policy?
I see trouble ahead. Nothing will be getting signed off any time soon.
8 golfcronie (#) Mar 23rd, 2014 - 03:10 pm Report abuse
Where are these basket cases in SA going to get US$? The biggest problem is going to be the devaluing of all currencies in SA.
9 ilsen (#) Mar 24th, 2014 - 01:19 am Report abuse
Sadly Venezuela has mortgaged much of it's oil futures to China and is committed to deals at current prices plus 1% for 25 years to the ALBA countries.
DOOM!
The EU can't do business because there will be NO USD to trade with regarding Venezuela.
Venezuela is a member of MercoSur and ALBA.
Just do the math.
No dollar No trade. No EU sign up.
Well done Maburro, you just f*ckef it all up for Lat Am.
hope you are proud of yourself!
10 Stevie (#) Mar 24th, 2014 - 06:38 am Report abuse
Ilsen
Are you illiterate?
Do you regard facts as something overvalued?

Venezuela is NOT part of the talks between Mercosur and the EU.

And should there be no agreement, it's therefor NOT Venezuelas fault.

You seem to be the burro here...
11 golfcronie (#) Mar 24th, 2014 - 12:22 pm Report abuse
@10
Is it not Mercosur negociating with the EU? Is not Venezuela a full member since 2012 ( July I think)
You may correct me if I am wrong.
12 Stevie (#) Mar 24th, 2014 - 02:36 pm Report abuse
Venezuela joined after the negotiations started and are therefor not part of those this time around.
13 ilsen (#) Mar 24th, 2014 - 10:10 pm Report abuse
But will be in the future dickhead!
' not part of this time around'
Being a junior expat in Europe you must have learnt that the EU has only become so powerful, past and present, because Europeans consider all angles and possibilities.
You are naive and out of your depth.
14 Stevie (#) Mar 24th, 2014 - 10:37 pm Report abuse
They are still not part of the negotiations, ilsen.
Regardless of how upset you are...
15 ilsen (#) Mar 25th, 2014 - 04:17 am Report abuse
Oh my little stalker Stevie. You do like to follow me about. . sad little boy.
16 the_Truth_shall_B_Trolld (#) Mar 25th, 2014 - 02:07 pm Report abuse
Here is the list of items I require from the EU to survive each day:

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.

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No deal. thank you.

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