MercoPress. South Atlantic News Agency

Brazil and Argentina clash over auto-export restrictions; top level mission heads for Buenos Aires

Cristina Fernandez had to cancel a trip to Sao Paulo to open the Argentina House because Dilma could not attend

A high level Brazilian government delegation is scheduled to arrive in Buenos Aires on Tuesday to discuss the 'urgent' re-opening of the Argentine market for Brazilian auto exports that have dropped 32% since the beginning of the year because of unilateral decisions from the administration of president Cristina Fernandez.

 According to the president of the Automobile Manufacturers Association from Brazil, Anfavea, Luiz Moan, President Dilma Rousseff instructed Minister of Development, industry and foreign trade Mauro Borges to organize a round of urgent formal talks with Argentina to discuss the issue.

“During the meeting with President Rousseff we explained that Argentine measures in the first quarter of 2014 have meant a drastic drop of 32% in automobile exports to Argentina, which is a great blow for the industry” said Moan who added he spent three hours talking about the issue with the Brazilian head of state.

Moan also recalled that Brazil and Argentina signed a memorandum of understanding last March to try and generate financial mechanisms to promote bilateral trade.

“The memorandum was agreed in Costa de Sauipe between Argentina's Economy minister Axel Kicillof and Borges during the Inter American Development bank assembly on 28 March” indicated Moan.

He added that “we need to make the financing of bilateral trade operational and that is the main purpose of the round of discussions in Buenos Aires”.

Argentina absorbs 20% of Brazilian car exports, which means that the collapse of the Argentine market represented a 7% drop in the car industry's sales. Moan and Anfavea also include 29 subsidiary industries.

Argentine president Cristina Fernandez was scheduled to visit Sao Paulo on Wednesday to open the Argentina House in Brazil, and hoped to have Dilma next to her. But apparently Brazilian diplomacy cancelled any meeting with Dilma Rousseff because of the 'presidential agenda'.

President Rousseff after meeting with Moan and industry representatives held talks with Borges and with Economy minister Guido Mantega and decided the issue needed an 'urgent' solution. Thus the delegation will also include the Executive Secretary from the Finance ministry, Rogerio Caffarelli, a direct envoy from Minister Mantega.