Uruguay, a founding member of Mercosur has been invited by Pacific Alliance members Colombia and Peru to update and expand commercial agreements with the two countries and turn them into a free trade treaty, foreign minister Rodolfo Nin Novoa revealed during a hearing in Congress to analyze the current situation in Mercosur.
Uruguay is scheduled to sign a free trade treaty with Chile next October, and has also been invited by Colombia and Peru to conform a free trade area and update and improve the current treaty with Mexico, Nin Novoa told Uruguay's Lower House International Affairs Committee.
Chile, Peru, Colombia and Mexico are the founding members of the Pacific Alliance, the trade area which in five years has proved to be more dynamic and effective than Mercosur and its quarter of a century. Mercosur is made up of Argentina, Brazil, Paraguay, Uruguay and Venezuela, plus Bolivia in the process of incorporation.
The Uruguayan government policy is to advance bilateral trade treaties, which does not mean abandoning Mercosur efforts to establish new relations with other spaces, and in this framework Uruguay will be signing a free trade agreement with Chile, which is considered a model for the region, pointed out Nin Novoa.
However reaching the treaty with Chile will not be very smooth despite president Tabare Vazquez administration efforts since Communist led unions umbrella organization Pit-Cnt want to analyze the small print since they openly disagree and fear the Pacific Alliance and even worse the Trans Pacific Partnership sponsored by the United States.
Pit-Cnt considers that Chile´s labor legislation is far inferior to that of Uruguay and we don't want the treaty to accept those inferior terms threatening all the advances conquered by Uruguayan workers, said Pit-Cnt chairman Marcelo Abdala. He added we have instructed our economics and international affairs desks to analyze the possible negative effects for Uruguayan workers.
The Uruguayan ruling coalition is split between the more conservative and orthodox wing headed by President Vazquez and Nin Novoa, and the more radical populist side led by ex president Jose Mujica. Although Mujica preaches free trade and opening the economy when it comes to votes he makes a U turn in support of local industry and protecting jobs, torpedoing such trading advances. The ex populist president also commands a majority in Congress.