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03/02/2006 | Argentina signs pact with Brazil that restricts Brazilian imports

A.P.

Argentina and Brazil agreed Wednesday on a trade deal that lets Argentina restrict Brazilian imports, overcoming differences between the two Mercosur trade bloc members, government officials said.

 

The countries have been negotiating for weeks over the measures they can use to limit imports from one another to protect local industries.

Argentine Economy Minister Felisa Miceli told a televised news conference that the new mechanisms give Argentine manufacturers some protection from their larger counterparts in Brazil "so that our industry can be strengthened."

Argentine government officials and business leaders have long advocated measures to compensate for "asymmetries" between the two countries because of Brazil's much larger size, its ability to attract investment and provide fiscal incentives.

Brazilian officials have pushed for improved regional integration, saying bilateral bickering distracts the countries from the more important challenge of competing with other emerging markets for investment and trade opportunities.

It was not immediately clear which sectors are covered under the agreements signed Wednesday. The two countries are also negotiating a trade deal for automobiles.

In the past, Argentine and Brazilian manufacturers have clashed over textiles and home appliances such as washing machines.

On Wednesday, Miceli called the pact "a triumph of cooperation and common work" and urged further steps to strengthen Mercosur.

Argentine news media have said the negotiations centered on how to define "harm" to an industry and how long tariffs and import quotas should be in effect. Argentine officials reportedly pushed for longer-term restrictions, while the Brazilians wanted clear standards on when such measures could be applied.

Armando Monteiro Neto, president of the Brazilian Confederation of Industries, his country's largest industrial group, said the new deal presents "worrisome aspects."

"There are indications that not all of the points put forward by the private sector prevailed in the negotiations," he said.

Brazilian Deputy Foreign Minister Samuel Pinheiro Guimaraes said his side was pleased with the results.

"This is not a mechanism of controlling trade," he said. "It permits the expansion of trade ... and investment, and it will foster in its second stage a diversification in the relationship (of Argentina and Brazil) with other countries."

AP (Estados Unidos)

 


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