MercoPress. South Atlantic News Agency

Mercosur/EU ready market access proposals for next round of trade talks

EU Trade Commissionaire Karel De Gutch

Mercosur and European Union delegates are scheduled to meet at the end of the month or early December in Brasilia for a new round of talks leading to a wide ranging trade agreement which both sides have agreed should be ready to conclude negotiations in the first half of 2011.

However both sides still have to present their respective proposals on market access which has proven the most challenging issue: the South American block (Argentina, Brazil, Paraguay and Uruguay) fears the impact of EU industry and services, while Europeans the inroads that Mercosur efficient agriculture and food industry could make into a highly sensitive sector.

However both sides have agreed that the objective should be the elimination of tariffs on goods; liberalization of services and investments, address other non tariff barriers and improve the overall framework to promote trade.

This understanding was reached in spite of strong opposition from the EU farm lobby and a group of countries headed by France and Ireland reluctant to allow Mercosur produce into the EC.

Precisely this week Paraguay’s Finance minister Dionisio Borda met with the EU Trade Commissionaire Karel De Gutch in Brussels for an update of the negotiations hoping to give a further thrust to the process, which if successful should be extended to include gradually the rest of Latinamerica, “further helping to consolidate regional integration”.

Trade talks between the South American group and the EU, originally launched in 1999, had been suspended since 2004 given the lack of agreement at the World Trade Organization Doha Round for the liberalization of global trade.

The resumption of EU/Mercosur trade talks was announced last May in the framework of a presidential summit in Madrid of the two blocks, and was followed by a round in June in Buenos Aires, later in Brussels in October, and the next in Brasilia.

The fact Latinamerica overall and two of the region’s three main economies (Brazil and Argentina) managed to weather the global slowdown successfully and are forecasted to keep a sustained pace of growth in the near future has determined the EU to advance in the trade negotiations.