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Montevideo, March 27th 2019 - 02:49 UTC

Brazil turns protectionist: wants Mexico to limit car exports to 1.4bn in three years

Wednesday, March 14th 2012 - 00:07 UTC
Full article 14 comments
Mexican car exports to Brazil increased 40% in 2011 Mexican car exports to Brazil increased 40% in 2011

Brazil's government wants Mexico to impose quotas on its own auto exports to the South American nation to ensure the total value does not exceed 1.4 billion dollars over the next three years, the development, industry and foreign trade ministry said.

The request was contained in a letter sent to Mexico's economy and foreign secretaries, Bruno Ferrari and Patricia Espinosa, who head a Mexican delegation reviewing a bilateral free-trade agreement on cars, the official Agencia Brazil news agency said.

The ministry did not give more details about the letter and said it will only provide more information after receiving a response from the Mexican government.

Brazil says vehicle imports from Mexico rose last year by 40% even as Brazilian auto exports to Mexico declined by the same percentage, resulting in a trade deficit in that sector of nearly 1.7 billion dollars.

In February, Brazil called for a revision of the countries' 2003 bilateral Economic Complementation Accord, which regulates tariff-free trade in vehicles and car parts.

President Dilma Rousseff's government also suggested the possibility of expanding the 2003 accord, which is currently limited to auto parts, passenger cars, trucks and heavy vehicles.

Among other changes, Brazil wants the requirement of 30% domestic content for vehicles exported under the accord revised upward, citing concerns that Mexican cars have an excessive amount of components manufactured elsewhere.

Mexico, for its part, acknowledges that it had a significant trade surplus with Brazil in that sector last year, but it says that since the agreement went into effect in 2003 it has accumulated a vehicle-trade deficit with the South American giant of around 10 billion.

Cabinet-level officials in the two countries met in Brasilia Feb 29 to discuss the matter and those talks resumed Friday in Mexico City.

Brazil's auto industry, like other manufacturing sectors in the country, has been battered by a strong Real, while Mexican subsidiaries of General Motors, Nissan and Volkswagen posted strong export results in 2011 due to a weaker peso.

Top Comments

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  • pepegalleta

    eferybody here talk bullshit about Argentina, but is not the only one to try to peotect the industry

    Mar 14th, 2012 - 02:56 am 0
  • McClick

    @ 1 Pepe

    Just a friend advice for you.

    Keep away from luxury cars and living styles to avoid likely becoming
    social ethnic target in USA where has hyper ethnic tension

    Be careful that to not to be driven away again like as from Spain and Germany occured before in the history.

    You saw and remember how the plundering arised abruptly in 2001-02
    in Argentina, so there can not be guaranteed similair acts in anywhere anytime in the world in the future.

    Mar 14th, 2012 - 10:48 am 0
  • toooldtodieyoung

    2 McClick

    I'm afraid that you are just not making any sense at all. However to-the-point your arguement / point of view might be. I think it got lost in the translation.

    pepegalleta, bless him, has appalling spelling but at least you can follow his train of thought, even if it does run over a cliff from time to time. You are just making no sence at all my friend.

    Mar 14th, 2012 - 02:43 pm 0
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