Cyber Monday Deal: Up to 60% off InvestingProCLAIM SALE

Mercosur presidents meet, stung by U.S. metal tariffs

Published 12/03/2019, 03:51 PM
© Reuters. Soldiers of the Brazilian army control traffic near the Spa de Vinho hotel, which will host the next Mercosur summit

By Lisandra Paraguassu

BENTO GONÇALVES, Brazil (Reuters) - The presidents of South America's Mercosur trade bloc meet on Wednesday under the cloud of tariffs restored by U.S. President Donald Trump on steel and aluminum imports from its two largest members, Brazil and Argentina.

Hobbled by political differences and government changeovers, the four-nation common market is not expected to take a joint stance against Trump's surprise move on Monday, which shocked South American officials and left them scrambling for answers.

Argentine Production Minister Dante Sica said on Tuesday that Argentina and Brazil will hold a bilateral meeting at the summit to discuss the U.S. tariffs.

But Argentina's President Mauricio Macri has less than a week left in office and his left-leaning Peronist successor, Alberto Fernandez, has sparred openly with Brazil's right-wing president, Jair Bolsonaro, who called the incoming leader a "red bandit."

Uruguay, where conservative President-elect Luis Lacalle Pou will take office in March, will be represented at the Mercosur summit by Vice President Lucia Topolansky.

Given the changeovers, the summit will not be able to agree on the main item on the agenda, reducing a common external tariff that has been in place for more than two decades and Brazil is pushing to lower, a senior Brazilian diplomat said.

Pedro Miguel da Costa e Silva, head of regional negotiations at Brazil's foreign ministry, told Reuters that any decision would have to wait for the new Argentine government to lay out its policies.

On Thursday, the leaders of the four nations, including Paraguayan President Mario Abdo, will formally sign Mercosur's free trade accord with the European Union, completed in June after 20 years of negotiations.

The agreement, currently undergoing legal scrubbing and translation into two dozen languages, must still be ratified by the legislatures of the Mercosur and EU member states.

© Reuters. Soldiers of the Brazilian army control traffic near the Spa de Vinho hotel, which will host the next Mercosur summit

The question is whether Fernandez, a protectionist, will try once in office to reopen the deal, as he has said he intends to do, to re-negotiate parts that do not suit Argentina.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.