MercoPress. South Atlantic News Agency

Uruguay to take pulp mills dispute to EU/Latam summit

Uruguayan president Tabare Vazquez will participate of the European Union/Latinamerica leaders' summit scheduled for next month in Vienna with the purpose of “putting on the table” the ongoing pulp mills dispute with Argentina.

President Vazquez currently visiting Mexico and United States (next week he will meet President George Bush in the White House), will be leaving for Austria next May 11.

The decision to participate in the summit, originally in doubt because of the conflict with Argentina and the internal disputes in Mercosur, was confirmed following the strong support for the construction of the pulp mills from the European Union Trade Commissar Peter Mandelson.

Finland's Botnia and Spain's Ence are constructing pulp mills next to the river Uruguay which is the natural border with Argentina, an operation involving 1.8 billion US dollars, the country's largest ever single private investment.

However Buenos Aires disputes the construction for environmental reasons and residents on the Argentine side of the river have blocked an international bridge to protest the plants with the passive complicity of the President Kirchner administration.

Uruguay is demanding an urgent meeting of the Mercosur Council claiming Argentina's attitude in contrary to the text and spirit of the bloc which guarantees the free movement of people and goods between country members.

Argentina which until next June chairs Mercosur is reluctant to convene the Council insistently claiming the dispute is "bilateral and environmental".

According to Uruguayan press sources President Vazquez is also interested in the EU/Mercosur free trade negotiations which have been stalled for months.

"President Vazquez would like to see a re-launching of the free trade talks and will personally lobby the matter", said Uruguayan diplomatic sources.

Uruguay is also concerned with comments from Mr. Mandelson who underlined Uruguay and Argentina must solve the dispute and ensure the construction of the pulp mills, otherwise it could have a negative impact on future EU investments in the area.

In Buenos Aires President Kirchner insisted with having an environmental impact report on the pull mills effects before construction further advances.

"The Uruguay river is a jointly shared and managed river so we are demanding an environmental impact report and hopefully it will be positive for the investment. But if not, construction must stop because above all is life and our job is to protect the lives both of Argentines and Uruguayans", underlined President Kirchner.