ANDEAN COMMUNITY: Will Fujimori go to Sucre?

By Estrella Gutiérrez Reprint | | Print |

Estrella Gutierrez

CARACAS, Apr 4 1997 (IPS) - If Peru does not enter the Andean free trade group by next Tuesday, “only four of us will go to Sucre,” said Venezuela’s Industry and Trade Minister Freddy Rojas.

Sucre, Bolivia will be the site of the bloc’s presidential summit on April 22, he explained.

Rojas said the ministerial meeting in Bogota next Tuesday will be of key importance for Peru’s future within the Andean Community, as this will be the last chance for agreement to be reached.

He said “we have advanced” positively since the meetings in Caracas in January and Lima on Mar. 18, adding he was hopeful the flexibility shown by the Andean partners and the efforts of Peru itself, would ease its incorporation into the free zone from May.

Peru’s Alberto Fujimori administration shut itself out of the Andean trade agreements from Aug. 25, 1992 and did not enter the free trade zone which will be in total operation between the other partners from February 1993, nor the Tariff Union, operative from Feb. 1995.

Negotiations held from March 1995 onwards have tried to push Peru “down off the fence,” but the toing and froing which ensued led to crisis on Jan. 27, when a meeting of Trade and Foreign ministers gave Lima the ultimatum of being either clearly in or completely out.

The Andean bloc is made up of Bolivia, Colombia, Ecuador, Peru and Venezuela, and in had trade of around five billion dollars in 1996, almost all in non-traditional products.

No one is asking Fujimori to take on the Andean Common External Tariff (CET) for third countries – the reason Peru has become marginalised – he is only being asked to adopt the zero rate tariff on trade within the block.

“We have managed to differentiate this, the Tariff Union will be considered later, what we others demand is that Peru join the Free Trade Zone right now,” said Rojas.

In reality, the Bogota meeting, which will be preceded by a meeting of the altern representatives, which is formally a rerun of Lima, where the only outcome after a “very demanding day” was another suspension, providing time for a viable formula to be thought up.

Peru presented a proposal of five lists of sensitive products in Lima, some broader than others, which aimed to delay the removal of tariffs “far into the future,” he explained.

But the Venezuelan Minister said despite the fact this was a unilateral plan, not given previous consideration by the technical Council of the group, “we agreed to cut down and condense the lists and incorporation will be within the short-term, with a zero tariff level for all tariffs by the year 2000.”

Lima has been asked to adopt an agressive tariff reduction scheme from May 1, when the first two lists will reach zero, the schedule for 3 and 4 will be shortened, and 5, which includes the exceptions from 15 branches, will be incorporated in the year 2000.

“There is evident flexibility on our part, compared with the January position, which was yes or no, but Peru must show its initial commitment to reduce tariffs, with a clear demonstration and not a plan for us to wait until 2004,” said Rojas.

“This has to come out in Bogota Tuesday,” he said, adding he would accept progressive incorporation, but with precise conditions and deadlines, where the issues which worry Peru can be handled rapidly. “But it has to enter the club first, and once inside the club we can talk,” he added.

The minister explained most of Peru’s concerns were shared by Venezuela, like the part on norms, as this leads to distortions, the introduction of specific requisites of origin, and regulations on health aspects of the free zones.

Lima also wants to revise some aspects related to the CET, “but as they are not members of the Customs Union, neither the advantages nor disadvantages apply to them,” he said.

The Andean tariff range is divided into 6,200 parts, 1,600 of which will go onto zero rate in Peru from May if the formula proposed by the other four partners is accepted. For Lima, this group will cover half its exports.

But Rojas reaffirmed the flexibility did not exclude “a categoric stance” including the other countries led by Colombia and Venezuela, the natural dynamos of the proc earlier, now we have decided to flexibilise the process and increase the number of meetings.”

Rojas, who follows the Peruvian press daily, said the tariff issue had been the main national economic concern for months, and the government itsevery, very concerned that Peru is not in, and we have made this known to Lima.”

“This nation, which has been through so much with us, is a key nation in South America, and South America is going to unite commercially, and it is not feasible on Lima’s part to be a bilateral partner of the others,” he said.

The Andean Community and the Southern Cone Common Market (Mercosur – Argentina, Brazil, Paraguay and Uruguay) are negotiating a free trade zone, to be agreed by September “or earlier, now we have decided to flexibilise the process and increase the number of meetings.”

Rojas, who follows the Peruvian press daily, said the tariff issue had been the main national economic concern for months, and e tariff issue had been the main national economic concern for mo