MercoPress. South Atlantic News Agency

Talks on a common currency

Mercosur full members will begin discussing next February in Montevideo, Uruguay the creation of a common currency for the trade block. The announcement was made by Argentina's Foreign Affairs Minister, Carlos Ruckauf who nevertheless anticipated it will be a long and by no means a simple process, "but we need a common currency and we must help with the creation of mechanisms that improve the customs union". Mercosur's integration process, which had a spectacular launching in the early nineties almost run aground in the last few years because of the different exchange rate policies between the block's main partners, Brazil with a floating currency, and Argentina with a fixed peso pared to the US dollar. This led to permanent bilateral frictions and accusations of alleged "protectionism". Argentina recently and abruptly ended its decade long fixed exchange rate policy and devalued the peso, anticipating a floating currency system in six months time, once it puts its house in order following the current political and financial turmoil. Mr. Ruckauf also said he favoured a regional system for trade disputes in the block whose rulings were definitive. Currently when trade differences between partners emerge, a regional tribunal decides but it can be appealed to the World Trade Organization. "I believe the last stand must be the Mercosur tribunal", said Mr. Ruckauf.