MercoPress. South Atlantic News Agency

Brazil/Argentina hold new round of talks to facilitate bilateral trade

Industry Secretary Eduardo Bianchi leads the Argentine delegation

Mercosur main country members, Argentina and Brazil begun on Thursday a two-day round of bilateral trade talks in Brazil to discuss basically whether to continue or not with the non-automatic licenses both countries hold.

Argentine Industry Secretary Eduardo Bianchi will lead the official group in the second summit on the matter. It is expected for eight industrial sectors to begin working on shared projects.

The delegation belonging to Argentina is formed by public officials of the Economy Ministry, according to sources.

The first meeting to discuss industrial issues was held last month in Buenos Aires. Back at that time, Brazilian and Argentine authorities decided two sectors were to be merged: the strategic ones, including oil and gas industries, the car industry and agriculture machinery; and the intangible ones, featuring the wooden and furniture industries, and the wine and dairy industries, among others.

The conferences and events are to take place Thursday and Friday at the Development, Industry and Foreign Trade Ministry in Brasilia. The need to integrate the regions was previously formalized by Argentine Industry Minister Débora Giorgi and her Brazilian counterpart Miguel Jorge.

The underlying purpose for this meeting is to reduce the tension aroused by bilateral agreement and business, brought about due both countries' measures. The non-automatic license issue is to be posted and discussed.

Divergences between Mercosur main partners were born following the global trade meltdown when Argentina imposed the non-automatic licences to Brazilian exports, a mechanism contemplated under WTO rules which basically delays import permits up to two months. Brazil responded with similar measures.

Following top level and technical meetings and even presidential summits it was decided to eliminate some of the most “distorting” measures but others remain, generating strong protests from Brazilian industry.

However as the global economy recovers so does bilateral trade which, contracted significantly during 2009. The latest data shows that Brazilian exports to Argentina in February soared 66% to almost 1.2 billion US dollars compared to the same month a year ago. Similarly Argentine sales to Brazil reached 999 million US dollars, up 50%.

With this background scenario, talks should develop in a more “positive integration” spirit according to Brazilian Foreign Affaire minister Celso Amorim words.