Mercosur

Items

• Failure of EU talks detracts from CAN breakthrough

  17 November 2004 Hits: 122

  October has been a month of mixed fortunes for Mercosur. On 18 October the bloc signed its long-awaited free-trade agreement (FTA) with the Andean community (CAN). Just two days later, however, talks between Mercosur and the European Union on another FTA broke down.

  CAN deal done
  Despite being signed months later than scheduled, members of the Mercosur and CAN are hailing the FTA as an historic step forward for the region. The new FTA creates the world's fifth largest trade zone and prepares the ground for the Free Trade Area of the Americas (FTAA). According to Peru's foreign minister, Manuel Rodrí­guez Cuadros, the Mercosur-CAN economic area covers 17m km2, comprises 350m consumers, has a GDP of US$800bn and internal trade of US$30bn. Rodrí­guez reckons this last figure could reach US$50bn by 2007. Mercosur comprises Brazil, Argentina, Paraguay and Uruguay as permanent members, while CAN is made up of Bolivia, Colombia, Ecuador, Peru and Venezuela (these last two are also associate members of Mercosur). Eduardo Duhalde, president of Mercosur's commission of permanent representatives, applauded the deal but reminded the two blocs that the area 'is the most unequal in the world'. He called on the member states to fight against poverty and social inequality.

  EU on back-burner
  The perennial postponement of the FTA is becoming a bit of a standing joke. It is the world's longest-running trade saga and it is now to set to run until at least 2005 and probably much longer. This is because trade representatives from the two blocs were meeting for the last time before the new EU trade commission takes over on 1 November. The new EU trade commissioner, Peter Mandelson, has already made it clear that he does not consider an FTA between the EU and Mercosur to be a top priority. The only tangible agreement reached by the two sides was to hold a meeting by the end of the year to set a date for ministerial talks in the first quarter of 2005. However, the foreign minister of Brazil, Celso Amorim, insisted that progress had been made.

• Quotes of the month

  17 November 2004 Hits: 116

  “We are not big enough to challenge the IMF. The relationship between Uruguay and the fund is good, and we intend to keep it that way."
  Uruguay's José ''Pepe'' Mujica, a senator and member of the EP-FA coalition led by Tabaré Vázquez.

  “I believe that these actions by President Jorge Batlle - this gorilla who is president of Uruguay, who doesn't like us - are the desperate acts of someone who is on the way out. He is making agreements worth millions of dollars, compromising the next administration when we are just days away from a national election."
  Jorge Busti, the provincial governor of Entre Rí­os, Argentina.

  “Clearly there is a long tradition, if you can call it a tradition, of a twisted culture in Paraguay, but that this country has improved its position in the fight against piracy, everybody knows."
  Nicanor Duarte, the president of Paraguay.