External tariffs discussed at Mercosur foreign ministers virtual meeting

Tuesday, April 27th 2021 - 09:50 UTC

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Argentina advocated for a reduction in tariffs, “but using a segmentation methodology,” said Solá

The Government of Argentina Monday submitted a proposal for the average reduction of the Common External Tariffs during a virtual meeting of Southern Common Market (Mercosur)'s Foreign Ministers, it was announced.

Argentine FM Felipe Solá advocated for a reduction in tariffs, but using a segmentation methodology in agro-industrial, industrial, capital goods, information technology and telecommunications.

Meanwhile, Uruguay formally insisted on making Mercosur “more flexible” and supported a common external tariff, which already had Brazil's endorsement, according to Uruguayan diplomatic sources.

All proposals are to be discussed in the second half of May when the top diplomats of all four member countries -Argentina, Brazil, Paraguay and Uruguay- meet face to face in Buenos Aires under strict covid-19 protocols.

“We must think about what capacities different sectors of the economy have to withstand a reduction in different positions of the common external tariff and what implications a unilateral reduction has in the face of external negotiations,” Solá said.

“The Uruguayan proposal is being studied by the Common Market Group coordinators to generate the inputs that enable decision-making at the next meeting of the Common Market Council,” Uruguay's Foreign Ministry said in its Twitter account.

Uruguayan President Luis Lacalle Pou was briefed late Monday on the outcome of the meeting, before which he had pointed that there were “rapprochements with some countries” about Brazil's support.

“Mercosur moves by consensus and that is an issue that is not minor when it comes to analyzing Mercosur decisions: there is no voting, it is not that we beat someone three to one or we lost three to one,” Lacalle had said. “If everyone does not agree, Mercosur does not advance. Precisely what we are proposing is going to directly attack that point: those who do not want to advance for a certain reason should make room for any of the partners to advance either at a different speed or with other countries to have the possibility to expand our market, not pay too many tariffs,” Lacalle had explained before the meeting.

Uruguay's bid includes a provision to “reaffirm the commitment of the Mercosur States parties to negotiate trade agreements with third countries or groups of extra-zone countries in which tariff preferences are granted.” The Common Market Council will also have to “approve in the first semester of 2021, an External Negotiations Plan, which must contain a detailed international insertion strategy.”