Amid Recriminations Among Members Brazil Convenes Mercosur Council

Mercosur countries Brazilian capital BrasÀ­lia will host this Monday, October 27, the Mercosur Council, which is scheduled to address an agenda of controversial issues including: the global financial crisis, commercial asymmetries among country members and Uruguay's veto to former President Nestor Kirchner's for the chair of Unasur.

Finance and Foreign Affairs ministers plus presidents of Central Banks from Mercosur full and associate members are scheduled to exchange ideas about the ongoing global crisis, how to address it and if there is latitude for some regional coordination.

Paramount is also the coming November 15 Washington meeting to be hosted by US President George Bush, the first of a round of consultations hopefully leading to the re-launching of a new global financial system. Argentina, Brazil and Mexico have been invited to Washington.

The Mercosur Council VII extraordinary meeting was convened by Brazil which currently holds the group's pro tempore presidency

One of the more immediate effects of the global crisis refers to Argentina's position in trade terms, which is geared to "protect" local sensitive industries with the establishment of "filters" and an alarm system to avoid saturation of the local market, according to the Buenos Aires press.

Among the imports on the watch list are mainly Chinese products but also some from Brazil, particularly textiles and foot wear, fearing they could he highly pernicious for the Argentine industry, particularly since the Brazilian currency has lost 35% of its value since the beginning of the financial crisis.

However since Argentina and Brazil have a "strategic alliance" and Brazil is a major player in global trade affairs and in the coming round to reform the financial system, it's hard to see Buenos Aires adopting unilateral decisions. A bilateral "consensus mechanism" can be expected to be reached.

Another uncomfortable issue is the latest controversy between Uruguay and Argentina, referred to the veto imposed on Mr. Kirchner, who has been proposed as chairman of the Union of South American Nations.

Uruguay objects Kirchner's attitude during the on-going conflict over the Botnia pulp mill and pickets blocking bridges leading from Argentina to Uruguay.

"How can you trust Mr. Kirchner, when as president he was unable to ensure the free circulation of people and goods between country members, as consecrated in the Mercosur charter?" argues Uruguay.

Argentina has reacted describing Uruguay's position as "injurious" for the Argentine people, for Argentina and for Unasur members who proposed Mr. Kirchner's candidacy.

Foreign Affairs ministers are also expected to define the group's position for the coming Ibero-American summit to be held at the end of the month in El Salvador, Central America.

Mercopress

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