The delicate trade relations between the two Mercosur powerhouses unravelled yet again last week, after Brazil imposed non-tariff barriers on imports of cars, car parts and tyres, prompting outrage in Argentina, which sends just over 80% of all its car exports to Brazil. Although the measure (making the auto sector subject to non-automatic import licences) is applicable to all countries, it was seen as a retaliatory measure against Argentina, which over the past year (with an eye on this year's elections) has erected a host of trade barriers. Patience in Brazil's private sector has worn thin and local industry representatives applauded the move, taking it as evidence that President Dilma Rousseff is less sympathetic than her predecessor, Lula da Silva (2002-2010), to the Argentine defence that it needs to protect domestic industry and employment and correct trade asymmetries between the two.
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