MercoPress. South Atlantic News Agency

Uruguay/Argentina working on ‘fast track’ to address trade differences

Minister Luis Almagro is optimistic about an agreement on the latest Argentine measures

Uruguay and Argentina are discussing a ‘fast track’ mechanism that will allow Uruguayan exports to have quick access to the neighbour’s market thus avoiding the controversial trade restrictions recently announced by the administration of President Cristina Fernandez de Kirchner and which have surprised Mercosur partners.

“There’s receptivity from the Argentine government for the implementation of an ‘automatic entry’, kind of fast track mechanism for Uruguayan exports to Argentina so that we don’t loose a single peso of our sales”, said Deputy Industry and Mining Minister Edgardo Ortuño following Monday’s regular meeting of the ministerial cabinet.

Last Friday Argentina announced it was extending the imports’ “non automatic licence” system to another 200 products totalling 600, which now cover from luxury cars and mobile phones to such simple items as textiles, toys, cardboard containers. Under the system, contemplated by the WTO, Argentina can delay up to 60 days the clearance of imports.

Argentina said the fatter list becomes effective March first and is geared to support the “re-industrialization process” started in 2003 (when the Kirchners took office) and protect Argentine jobs. Officials have said the system is applicable when imports threaten to take over the domestic market or knock out local manufacturers.

Uruguayan Foreign Affairs minister Luis Almagro said that Argentine representatives have expressed they are willing to “expedite” import licences to as to facilitate the access of Uruguayan products to the Argentine market.

“The cabinet ratified the dialogue attitude to address the issue of trade restrictions with Argentina given the extraordinary growth of Uruguayan sales to the Argentine market”, said Almagro who pointed out that in 2010 exports to Argentina had jumped 40% (equivalent to 200 million US dollars) and “so far in January another 26%”.

Almagro also underlined that when difficulties of this nature have been exposed, Argentina has been willing to dialogue and talk them over, “so we should not adopt a defeatist attitude, on the contrary we are optimistic that we will overcome this hurdle”.

The Foreign Affairs minister also confirmed that President Jose Mujica will be travelling to Buenos Aires Thursday, for a meeting with his Argentine counterpart Cristina Fernandez de Kirchner which is part of an agenda agreed months ago.

“The meeting will be basically informal, face to face, as have been the previous ones and the two presidents will address issues of the bilateral agenda, including the trade restrictions”, added Almagro.

Over the weekend President Mujica confirmed the ‘regular’ meeting in Buenos Aires and said that “talking and talking people understand each other, therefore he was sure a solution would be found to the restrictions”.

Argentine ambassador in Uruguay Dante Dovena Monday morning in a round of radio interviews said the latest measures from the Cristina Fernandez administration were not geared “against Uruguay or Brazil or any other Mercosur country”

“We have excellent relations with Uruguay, relations that are consolidating and helping regional integration. I’ve listened to Uruguayan officials and they betting on dialogue which is the same attitude we have in Argentina”, said Ambassador Dovena.

Uruguay’s Chamber of Industry sources estimate that the latest Argentine decision could have an impact on exports valued between 100 and 120 million US dollars, although “the problem is not that exports are finally liberated but rather that 30,60 days delay in some cases is too much time”.

The Uruguayan Union of Exporters said they understand the situation, “it’s not the first time this happens, nor the last for that matter, but we are satisfied with government’s support and attitude and how it is addressing the issue”.

Argentina has argued all along that the restrictions are targeted mainly to ‘cheap’ Asian imports that threaten local manufacturers’ share of the domestic market. “In six years, (2003/2009), the Asian share of Argentina’s gross manufacturing product has jumped from 1% to 20%, that is twenty times”, according to the Ministry of Industry Statistics Department.

Last week a delegation of Brazilian officials met in Buenos Aires with Ministry of Industry counterparts for the same reason and reached an agreement to name a committee that will monitor trade licensing.

Brazil is Argentina’s main trade partner together with China.