Next Wednesday Mercosur country members are scheduled to meet in Brazil to coordinate for the coming round of Mercosur/European Union trade negotiations that will be taking place in Brussels, October 11 to 15.
Mercosur is interested in reaching a quick understanding that gives greater access to the region’s farm produce to the EU. The EU wants more flexibility from Mercosur regarding industrial goods and services.
Since negotiations which were launched in 1999 had been stalled for so long (since 2004) both sides have expressed greater willingness in reaching an understanding even when there are strong oppositions inside both blocks.
“We’re going to agree on tariffs and quotas, and define the text of the proposal Mercosur will be taking to Brussels”, said Mario Piacenza, head of Uruguay’s Agriculture Ministry Department of International Affairs.
According to the Uruguayan official “all goods are on the table, but mainly agriculture because the EU defines them as ‘sensitive’ and protects them. And since protected, they have a penalty and that penalty is quotas”.
“We’re on a full offensive with all produce, fighting to have tariffs reduced and in a near future take them to zero”, said Piacenza.
Among the most sensitive issues for EU are beef, (Mercosur main market), rice (Uruguay is a leading exporter because it does not have GM seeds); dairy products, ethanol and sugar, among the most outstanding in a long list.
Piacenza said Uruguay is “optimistic” about reaching an agreement, and feels that with the Brazilian presidential election behind (October 3) a new window of hope is opening.
However in the EU France leads a group of at least ten countries that have openly rejected negotiations feeling Mercosur highly competitive produce will affect local production and condemn many farmers to sell their land and move to the cities.
On the Mercosur side Argentina which is sponsoring local industry (and jobs) is reluctant to open its market to EU manufactured goods. There was a recent spat when Argentine officials instructed importers “verbally” to freeze purchases of EU food products.
Although following the recent visit to the area of the EU Trade Commissioner Karl de Gucht things are back to normal, the volatile sensitivity remains.