ARGENTINA-BRAZIL: FTAA Puts Consensus to the Test

By Marcela Valente Reprint | | Print |

Marcela Valente

BUENOS AIRES, Oct 22 2003 (IPS) - Argentina and Brazil are not going to sign just any accord for the Free Trade Area of the Americas (FTAA), said Argentina’s foreign minister Wednesday.

The United States must talk about reducing its farm subsidies if negotiations to create the hemisphere-wide trade bloc are to advance, said minister Rafael Bielsa.

As far as Argentina and Brazil, which last week signed the “Buenos Aires Consensus” to advance a common foreign policy agenda, Bielsa said they cannot be expected “to obediently sign an (FTAA) accord against our best interests.”

He referred to the statements made Wednesday in Brazil by Peter Allgeier, deputy U.S. trade representative, that if the South American giant opposes the treaty, the FTAA will go on without it.

“Unlike the United States, I would prefer to create an FTAA with Brazil,” said the Argentine minister.

Bielsa sees the words of Allgeier, who arrives in Buenos Aires on Thursday, as a bid to pressure Brazil, with an eye to the FTAA meeting to be held Nov. 20 in the U.S. city of Miami.

The minister says that Argentina and Brazil “have to walk together” and, with respect to Paraguay and Uruguay (the other two members of Mercosur – Southern Common Market), he said they will not abandon the bloc in disagreement with the positions the two bigger partners have taken on FTAA and the World Trade Organisation (WTO).

The FTAA negotiations are not bogged down, says Bielsa, but rather are advancing at a slow pace. “I would like for us to meet the deadlines we proposed, but it doesn’t make sense to arrive on time, but badly, with an accord that doesn’t benefit us,” he said.

Asked during a press conference what would happen if the 34 countries (all except for Cuba) fail to produce a hemisphere-wide integration agreement, Bielsa said that there is no chance of anything apocalyptic occurring in trade talks, but said that Argentina would prefer to see some life in the negotiations.

Tensions between Brazil and the United States have been growing recently in regards to the FTAA, and also to the failure of the Fifth WTO Ministerial Conference last month in Cancun, Mexico, which failed to produce any trade agreements, largely because the industrialised countries refused to make greater concessions in cutting their farm subsidies.

Brazil was among the leaders of developing countries demanding farm trade liberalisation and opposing opening the WTO debate to other issues (investment, services, government procurement), giving rise to the group known variously as G20, G22, or G20+, with the membership fluctuating between 16 and 27.

Roberto Rodrigues, Brazil’s minister of agriculture, suggested Wednesday that an FTAA without Brazil would be a “second class” free trade area.

He had added fuel to the fire earlier when he said that the meeting in Miami “could be for the FTAA what Cancun was for the WTO” if it fails to take up the issue of U.S. farm subsidies.

Adhemar Bahadian, Brazil’s lead negotiator for the FTAA, says the process of hemisphere-wide integration runs the risk of not getting beyond the project phase, due to the U.S. resistance to acknowledge the imbalances that exist in the negotiations between the United States and Canada and the rest of the countries.

According to the figures that Bielsa cited, the industrialised world spends as much as 360 billion dollars a year in subsidies for farm production and exports, compared to the 56 billion for food assistance programmes.

“This reality is not only an offence to the peoples who export farm commodities, but also distorts prices and is extremely inefficient,” the Argentine foreign minister told a press conference.

Bielsa stressed that nobody is expecting the United States or the European Union, the world’s leaders in farm subsidies, to dismantle these regimens in one year, but said that if a timeline for reducing subsidies exists, “it is a bad sign that they don’t want to talk about the issue.”

“We cannot accept this because it is damaging to our interests,” said the minister.