MercoPress. South Atlantic News Agency

Europe waiting for Mercosur to overcome ‘Paraguay situation’ and resume trade talks

De Gucht says EU prepared for a Mercosur with Venezuela, which adhered to free movement of goods and services in 2006

The European Commission remains “on hold” waiting for the evolution of events in Mercosur with the incorporation of Venezuela as full member and the suspension of Paraguay, before addressing a new round of association and trade negotiations.

“There are no concrete elements which could indicate how the incorporation of Venezuela could impact on the negotiations’ dynamics”, said European Trade Commissioner Karel De Gucht questioned by a UK member of the European Parliament belonging to the group of European Conservatives and Reformists, Robert Sturdy.

De Gucht also underlined that “so far Venezuela has not made any public statements on the trade elements of the association agreement between Mercosur and the EU currently in course”.

The MEP was interested in knowing how Venezuela’s inclusion in Mercosur could impact on negotiations with the EU for a free trade agreement, “taking into account that Venezuela has been in the past deeply hostile towards trade liberalization”.

Venezuela last 31 July became full member of Mercosur thus joining Argentina, Brazil, Uruguay and Paraguay, currently suspended since the end of June following the removal of Fernando Lugo from the presidency of the country.  

The EC at the beginning of July made it clear, a few days before Venezuela was formalized as full member, which it would continue to negotiate an association agreement with Mercosur if President Hugo Chavez finally managed to formalize his country’s inclusion in the group.

De Gucht said he had taken note of Venezuela’s access and confirmed that the EC is waiting for the country to fully participate in negotiations between Mercosur and Europe. He also recalled that Venezuela was already associated to the process as an observer since the re-launching of negotiations in 2010, and underlined that the EU “only discusses with Mercosur as a region and not with individual member countries on a bilateral basis”.

MEP Sturdy also asked if the EC believes Venezuela would adhere to the (1991 Mercosur founding) Treaty of Asuncion principles in favour of free movement of goods, services and production factors among countries.

De Gucht said that the Venezuela/Mercosur access treaty dating back to 2006 already anticipated its adhesion to the Treaty of Asuncion as well as transition periods for the progressive integration of the country to the regional block.

“This applies mainly to the commercial dimension of Mercosur, particularly to the acceptance and adoption of a common external tariff and the free circulation of goods and services”, he added. And now this rests on Mercosur “to decide with how much precision to apply on transition elements and how it can update obsolete elements of the access treaty”.

The EC is expecting that the next round of negotiations for an association agreement with Mercosur, originally scheduled for last July but postponed because of the political situation in Paraguay, can take place sometime this coming southern spring.

Overall EU/Mercosur negotiations which resumed in 2004 following several frustrated attempts advance at a very slow pace, especially those referred to trade.