MercoPress. South Atlantic News Agency

Brazil willing to wait to see how latest Argentine trade restrictions evolve

Paulo Skaf, it is important Brazil buys more from Argentina

Brazil’s private sector said it would grant Argentina a “confidence vote” and would wait until the end of February before assessing the consequence of the new import restrictions imposed by the government of President Cristina Fernandez.

“I’d rather wait until the end of February and wait and see where the Argentine Government goes after this” said Paulo Skaf, president of the powerful Sao Paulo Federation of Industries, FIESP during a press conference following a meeting with the Argentine ambassador in Brazil, Luis María Kreckler.

Since February 1st, Argentina demands that all importers sign a sworn statement detailing their intended purchases abroad before they are authorized to do so. The authorization process, which can also be negative, is believed to take from three to ten days, creating severe delays on imports.

“We will not be talking about delays when this program has just been implemented. I believe this is a measure put in place for a better coordination of Argentina’s organizations dealing with federal public administration,” Kreckler said.

During the meeting, Skaf and Kreckler discussed the need to restore the balance of trade, which in 2011 left over 5 billion dollars deficit for Argentina.

“Argentina buying from Brazil is good. However, it is also important that Brazil buys more from Argentina as well,” Skaf said.

Bilateral trade last year was over 34 billion dollars, making Brazil Argentina’s main partner.

Mercosur partners, Uruguay and Paraguay have also complained about the latest Argentine batch of measures but the administration of President Cristina Fernandez has promised to address differences.

When Argentina first announced the new imports’ scheme Brazilian Industry and Foreign Trade minister Fernando Pimentel (and a very close ally of President Dilma Rousseff), expressed disappointment saying that Argentina in trade issues “is a permanent problem”.

“Argentina has been a permanent problem. Politically we’re in good terms, but when it comes to the economy, it’s hard to deal with them” admitted Pimentel.

However from those first reactions things have began to move more smoothly and Pimentel has left discussions with Argentina to one of his female advisors.

However a similar reaction from the Brazilian sector was rapidly toned down when Skaf and other Brazilian industry chiefs met on several occasions with Argentine officials.

Skaf admitted to be surprised at the meticulous organization of the Argentines and said he would like Brazil to implement a similar system to ensure the domestic market from cheap Asian imports.