MercoPress. South Atlantic News Agency

“Smallest Armed Forces”

European Commissar visit

European Union Trade Commissar, Pascal Lamy will be visiting Argentina, Uruguay and Chile between September 21st. and 28th. According to a press release in Brussels Mr. Lamy will hold discussions with local officials on the ongoing Mercosur-European Union free trade negotiations and the possibility of launching a new round of talks. Mercosur-EU talks that begun in late '99 are currently stalled because of differences over agricultural policy and farm subsidies. Talks are scheduled for next November in Brasilia and Santiago. Mr. Lamy visited Brazil last April.

Inflation in Argentina and Uruguay

Retail prices last August increased 0,52% in Uruguay, and dropped 0,2% in Argentina. Inflation in Uruguay in the first eight months of 2000 reached 3,68%, still in the 4 to 6% target range for the whole year. In a closer analysis the impact of oil prices affected Uruguay's transport, communications and tariffs for government owned utilities, while persistent rain and cold weather had a negative influence on vegetables and fresh food overall. In Argentina which is undergoing a deflationary process, the accumulated inflation of the first eight months is equivalent to a mere 0,2%. Wholesale prices on the other hand in the first eight months reached 3%, mostly pushed by oil and fisheries prices, while electricity and textiles helped to compensate. During August the Uruguayan peso suffered a 1,29% devaluation against the dollar, double the inflation rate, meaning Uruguay is gradually recovering its international competitiveness. This does not apply to Argentina that has a fixed rate of one dollar to the peso.

Uruguay requests inspection

Uruguay has officially requested the International Organization of Epizooties, (OIE), in Paris for a technical delegation to inspect the sanitary situation of the country following the appearance of foot and mouth disease in neighbouring Argentina, Brazil and Paraguay. Uruguay and Chile are the only two Mercosur countries that have no reported cases of the disease. Uruguayan officials are particularly concerned with Argentina since one of the areas where cattle has been exposed to the disease, and 50