History of the sectoral commision for mercosur

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History of the sectoral commision for mercosur

It is important to stress the fact that, although US influence rises in the region, Europe remains the largest recipient of South American agricultural exports.

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As part of their strategy, South American states looked to the EU to establish an effective counterweight to US dominance. In addition, the FTAA was perceived by some EU sectors as a threat to Community interests in the region and generated the political momentum leading to a framework agreement Interregional Framework Co-operation Agreement to conduct negotiations between EU and Mercosur in order to create a political and economic association agreement.

The latter included the intention to establish a free trade area. The purpose of the agreement was to prepare for the creation of an Interregional Association Agreement between the EU and Mercosur to create a Free Trade Area - FTA between the two blocs with liberalization of trade in goods and services.

Regardless of the potentialities of this agreement, however, since April nearly 20 rounds of negotiations have been undertaken leading to no economic agreement.

In addition both blocs particularly Mercosur were reluctant to finalise an agreement before the current WTO Doha Round is completed. Agricultural issues are for both sides one of the most sensitive topics on the table of negotiations.

For Mercosur countries, agricultural exports are their most important source of trade revenue whilst the EU works to protect its farm sector. These positions make agriculture a so-called "noyau dur" or hard core of negotiations.

Mercosur in particular Brazil together with India and China, created the G standing against the EU and its agricultural distorting support measures especially in the phasing out of export subsidies.

History of the sectoral commision for mercosur

These subsidies are considered one of the most damaging policies for developing countries for distorting international market prices and restricting access to third markets. Mercosur, as an agricultural trade bloc, has been very determined to get better market access and puts pressure for reducing distorting support for agriculture in the EU as well as in other developed countries.

Considering the importance of this sector to Mercosur economy it is obvious that any bad deal would be agreed in the wait for some promises from other multilateral talks.

As previous experience illustrates, it is clear this will depend on the results of the current Doha Round at the multilateral stage where Mercosur plays an important role.

This explains why Mercosur and mainly Brazil did not agree to sign an accord even when the region needed it the most like during the crisis. On the other hand, the EU puts its efforts to get a good agreement in the sectors of its interest such as market access for its industrial products, and commercial services mainly.

Agricultural areas such as the Geographic Indication are a sensitive topic of negotiations, on which consensus cannot be reached at multilateral talks. Despite the difficulties of achieving an agreement between EU and Mercosur, it seems that both regions could benefit from it.

Similar circumstances occurred within the FTAA talks last December in Argentina at the Summit of Americas where Mercosur leaders refused an agreement in favour of focusing on the multilateral talks at the Doha Round before signing any agreement with the North major player.

For Mercosur the agreement with the EU would mean, in principle, getting a better market access for its agricultural products. In other words, earn more by trading in a quite "trouble-free market".

The dismantling of trade barriers in the EU for its agricultural products can be an important instrument to Mercosur to improve its growing manufacturing capacity which is most linked to this sector as the example of Biofuels shows, and to put an end to its strong dependency on raw material products.

The development of a manufacturing capacity mainly in agricultural products, which is more accessible for these countries, is a crucial point to provide Mercosur countries with a sustainable development and to provide conditions to face internal problems such as poverty reduction and social exclusion.

One important point in the field of agriculture for the EU is the fact that this agreement would be an opportunity to reach a good sanitary agreement providing predictable and legal security in trade in the EU foods Chain for issues of interest to the EU, considering the fact that the EU is highly dependent on Mercosur for food supply in the context of extra-EU trade.

Further, it would be an opportunity to get support for strengthening regional integration process following the EU model with a closer institutional and political co-operation.Mercosur was created in response to the history of competition between Argentina and Brazil for supremacy in South America.

This rivalry dates back to the colonial era when the Spanish and Portuguese empires vied for control over the extensive Rio de la Plata basin which covers parts of modern-day Argentina, Brazil, Paraguay and Uruguay.

The Sectoral Commission for MERCOSUR (COMISEC) was created on April 1, by Executive Decree No. / Eyes on Europe | Mercosur-EU Relations - Historical background and perspectives. Écrit par Adriano Jose Timossi. The Relations between the European Union (EU) and Mercosur have a centuries-long historical and cultural background.

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History of the sectoral commision for mercosur

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