Brazil Tries to Save Mercosur Offering “New Deal” to Junior Members

Brazil proposed in Montevideo a "new deal" for Mercosur and requested a "credit of confidence" from Uruguay, which has bitterly complained about the group’s functioning and is moving closer to the United States.

"The essence of my mission is to establish the foundations of a "new deal" (recalling US President Roosevelt’s plan to overcome the 1930 Great Depression), a new integration vision for Uruguay’s links with Mercosur and Brazil", said Foreign Affairs minister Celso Amorim during his visit to Montevideo, on Friday, June 23
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Mr. Amorim also met with Uruguayan president Tabaré Vázquez and asked for a "confidence credit" to address the repeated complaints from Uruguay regarding the attitude of Brazil and Argentina towards Mercosur junior members Uruguay and Paraguay, which are in the process of signing investment and trade agreements with United States.

"It’s not another visit," said Amorim who this weekend will be also visiting Paraguay. "This is closely linked to the fact Brazil will be chairing Mercosur for the next six months." Argentina will officially step down next July 20/21 during the group’s presidential summit to be held in Cordoba.

"In Brazil we believe Mercosur needs a qualitative stride, we need to jump from a Mercosur which is entirely tariff-guided to a Mercosur which understands the need for a common industrial and technological policy. That is the great step forward", said Amorim although admitting "it’s not going to be easy."

However, during a press conference when asked about the guarantees that the "new deal" would benefit Uruguay, Mr. Amorim stated that "there are no guarantees in life, or in politics. There’s strong political will. If not I wouldn’t be here."

Nevertheless Amorim admitted that "Mercosur has not delivered to Uruguay as was promised, which generates frustration," but underlined Brazil’s position contrary to individual country trade agreements with third parties.

"It’s not a question of admitting or not admitting such bilateral negotiations," it has to do with "the logic of the integration system we pretend to achieve."

"Mercosur opted for a customs union, which involves advantages and responsibilities, and joint negotiations." underlined Amorim.

"If European Union member Greece decides tomorrow to establish a bilateral trade agreement with Canada, it can’t be done, it’s against the integration logic," added Amorim who cautioned that "bilateral negotiations can bring immediate advantages, but less advantages on the long term."

Uruguayan Foreign Affairs minister Reynaldo Gargano said Uruguay has always "respected Mercosur mechanisms and procedures," and recalled that when negotiations with Mexico for a free trade agreement, "Uruguay made the official request and was authorized by Mercosur to continue."

Uruguay and United States last May announced the expansion of an existent commercial agreement which could lead to a more ambitious free trade deal, and the Vazquez administration warned that opposition from other Mercosur members could lead to a change in the membership status.

"All members are free to abandon full membership and become associates, if they wish," said Brazilian minister Amorim.

Mercopress – www.mercopress.com

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