MercoPress. South Atlantic News Agency

Argentina and Brazil agree to continue disagreeing (less intensely) in trade issues

Bianchi argued that only 6% of Brazilian products are exposed to import licences.

Brazil and Argentina reached “relatively productive” results following the Sao Paulo meeting of the bilateral trade monitoring committee to address the ongoing restrictions imposed by Argentina to Brazilian exports, according to diplomatic sources from both sides.

“The possibility of Brazil formally presenting a complaint before the World Trade Organization, as requested by Brazilian manufacturers is considerably more distant”, said Ivan Ramalho, a top official from the Brazilian Development, Industry and Foreign Trade ministry.

Following Brazilian exporters disappointment with the slow award of import licences, Argentina promised to liberate the documents “with the speed contemplated in the framework of accords”, said Eduardo Bianchi, Deputy Secretary for Trade Policy and Management from Argentina’s Production Ministry.

Last week the Brazilian National Industry Confederation, CNI recommended taking Argentina before the WTO, questioning the non automatic licensing system delays which go far beyond what has been established by WTO.

However following the two day meeting in Sao Paulo, members from both governments also agreed that the “main products exported by Brazil to Argentina” are suffering from the impact of the global crisis.

Bianchi also pointed out that the main products exported by Brazil to Argentina “are not subject to licences”. Only 6% of the list of export products is subject to licences.

But Ramalho said that “we told the Argentine government that the process of extending non automatic licences is of great concern, not necessarily because of values involved but rather because it includes highly sensitive products for Brazil” such as footwear, furniture and auto parts.

“We have shown the Brazilian delegation with numbers that Argentina has speeded the award of licences to those sectors and particularly to all those in which Brazil is involved”, added Bianchi.

In the first half of this year Brazilian exports to Argentina dropped 42% compared to a year ago, totalling 4.9 billion US dollars. This represents an overall fall in bilateral trade of 32.9%, down to 9.9 billion USD.

Nevertheless Brazilian manufacturers argue that 13.5% of exports to Argentina are exposed to the licence restrictions, three times more than in 2004 (3.7%).

Bianchi finally argued that in spite of some misunderstandings and the fallback in total imports, “for Argentina the main trade partner remains Brazil”.