Brazil, Argentina, Paraguay and Uruguay, which are members of Mercosur, should initiate a series of talks to discuss internal and external reforms of the bloc, including measures to reduce bureaucracy, reduce the Common External Tariff (CET) and, in the future, so that governments can make bilateral agreements with other nations that are not part of the economic group.
Block negotiators analyze the alternative of individual agreements and rule making. Under the current rules, Mercosur countries can not establish individual agreements with other nations that compromise the import and export taxes agreed by the bloc.
The theme is not new, as it was approached in 2016, at the beginning of Michel Temer’s government, but should gain ground in the new management amid President Jair Bolsonaro’s stated desire to expand access to other external markets for Brazilian products.
At the meeting today (16), between the presidents of Brazil and Argentina, Jair Bolsonaro and Mauricio Macri, the matter was discussed at the meetings. Until June, Argentina holds the rotating presidency of Mercosur, and will then hand over the command to Brazil.
Despite the intention to allow agreements outside Mercosur, which should be matured in the medium term, the Brazilian government is committed to continue negotiating within the bloc the most promising agreements in progress.
In the list of priorities, there are at least three more advanced negotiations: the Mercosur trade agreements with the European Union, Canada and the European Free Trade Association (EFTA), comprising Switzerland, Iceland, Norway and Liechtenstein.
Other deals, such as South Korea and Singapore, are also on the Mercosur radar for the next period. There is no deadline for conclusion of the negotiations, but there is an expectation that something concrete on some of the initiatives will be announced by the end of this year.
At the internal level, the idea of revising the Mercosur TEC would be more advanced. The CET is the import tax rate, also charged by the member countries of the bloc.
The value is standardized according to each item marketed, which has a common classification among countries. The goal, according to members of the federal government, is for the TEC to be “simplified and reduced”.
In a joint statement he made with Maurício Macri, on Wednesday in Brasília, President Jair Bolsonaro talked about perfecting the bloc and cited the need to reduce barriers and eliminate bureaucracies. In practice, the objective is to follow the work of regulatory convergence among countries and reduction of health barriers, focusing on trade liberalization.
During the meeting Bolsonaro highlighted the intention to “wipe out” the Mercosur. According to negotiators from the bloc, a mapping will be carried out on the bodies and working groups currently in operation in the bloc, with the perspective of re-evaluating the work and, eventually, closing some activities that are no longer considered a priority by governments, thus reducing the size of “Public machine” of Mercosur.
Source: Agencia Brasil / Comex do Brasil