TRADE: Mercosur Must Repeat WTO Exam

By Gustavo Capdevila Reprint | | Print |

Gustavo Capdevila

GENEVA, Sep 20 1996 (IPS) - The international tribunal that studies the behaviour of regional economic integration blocs demanded Friday that the Southern Common Market (Mercosur) provide further information.

Renato Marques, who represented the Mercosur at the meetings of the World Trade Organisation’s (WTO) Committee on Regional Trade Accords, which studied the bloc’s policies this week in Geneva, said the reputation of the Mercosur – Argentina, Brazil, Paraguay and Uruguay – “was not harmed” by the decision.

During Thursday’s meeting, Japan reiterated its protests against Brazil’s auto industry, which it accused of violating WTO anti-subsidy policies.

The formal complaint by Japan, which the United States, the European Union (EU) and South Korea joined, has been under study by the WTO conflict-resolution body since Jul. 30.

Marques – the general director of the Brazilian Foreign Ministry’s Integration Department – told IPS that Japan’s presentation at Thursday’s meeting “was not fitting,” because “Japan and Brazil are in bilateral consultations.”

Referring to the Committee’s ruling that the information provided by the Mercosur was incomplete, Marques agreed that the rest of the members of the WTO had a “legitimate interest in obtaining more statistics” from the bloc.

Since the creation of the Committee on Feb. 6, the Mercosur has been subject to the new procedures intended to facilitate the process of studying regional blocs.

Hence, Marques called the tribunal’s decision natural: “The groups that now fall under WTO scrutiny must submit themselves to this new procedure.”

Nevertheless, the exam of the Mercosur’s policies had begun “before the new rules” went into effect, when it was “not yet subject to the new format,” he underlined.

The Committee meetings, in which a “climate of understanding” prevailed, according to Marques, turned out to be “an excellent opportunity to clear up certain points of interest for the other States,” he said.

He also said Hungary’s complaint against Argentina during the meetings was inappropriate. The delegate from Budapest said he had been waiting for two months for a response from Buenos Aires regarding a problem of excess taxes on exports.

Marques suggested that the delegations from Mercosur countries analyse the information available with the WTO. “If it is necessary, we can provide complementary information to be distributed among WTO member countries.”

The Mercosur had presented its previous report to the world trade body last October. The new report presented by Marques states that “the Mercosur’s policy of open regionalism is easily verifiable.”

Marques pointed to “the significant progress in free trade” in the Mercosur, among whose members over 95 percent of the trade has been liberalised.

As efforts are stepped up to coordinate technical rules and health stipulations established by national laws, that percentage is growing, he added.

Another example of the liberalisation of Mercosur markets is reflected by imports from outside countries, which rose from 21.1 billion dollars in 1990 – a year before the bloc was founded – to 55.7 billion in 1995, a 163 percent growth.

The Mercosur’s negotiations with other countries is a further demonstration of its openness, Marques stressed. He pointed to the accord that gives Chile associate status with the Mercosur as of October, and a similar accord with Bolivia.

The Mercosur signed a framework accord for inter-regional cooperation with the EU in December 1995, he added, and is currently discussing free trade agreements with Venezuela, Colombia, Ecuador and Peru, while seeking negotiations with Mexico.

Discussions on the creation of the Free Trade Area of the Americas (FTAA) are also being held, as well as informational contacts with New Zealand, Australia, Canada and the Caricom (Caribbean Community).