São Paulo – Representatives of the Mercosur and of Egypt will meet on July 31st and August 1st in San Juan, Argentina, to try and conclude the free trade agreement that they are negotiating and have it ready to be signed at the summit of the South American bloc, due on the 3rd next month, in the same city.
“If we manage to settle the [existing] pending matters, then [San Juan] will be the occasion for signing it,” said yesterday (27th) the ambassador Evandro Didonet, head of the International Negotiation Department (DNI) of the Brazilian foreign ministry (Itamaraty). “If we do not succeed, then negotiations will continue, and we will try again later,” he added. The Egyptian minister of Industry and Trade, Rachid Mohamed Rachid, should attend the Mercosur Summit.
The fifth round of negotiations was held on the 12th and 15th this month, in Buenos Aires, but a consensus was not reached regarding all matters. According to Didonet, pending issues concerning the rules of origin and the forecasted deadline for tariff reduction on certain products to enter into force.
The ambassador stated that a draft agreement has been concluded concerning rules of origin, but that “some adjustments are still required” with regard to more favourable rules “to the smaller economies of the Mercosur,” i.e. Uruguay and Paraguay. There is also an ongoing discussion on the rules applicable to the textile sector.
The rules of origin set the rate of nationalization that a product must have in order to be entitled to the benefits of the agreement. In other treaties negotiated by the bloc, for instance, items produced in Uruguay and Paraguay may have, for a given period of time, lower nationalization rates than those required from Brazil and Argentina.
With regard to the tariff reduction deadlines, Didonet stated that the Mercosur is calling for Egypt to be faster in adopting tariff reduction on certain products, and vice versa. Besides, the inclusion of certain items in the tariff reduction schemes has not been defined yet, especially some that are of interest to Brazil, such as chicken, soluble coffee and certain types of paper.
The ambassador claimed, howver, that the adjustments required are “marginal” and should not prevent a conclusion from being reached. “All of the parties are working to conclude the agreement. Egypt is an important market and [the agreement] is a goal that is shared [by the Mercosur member countries],” he declared. “By the same token, there is much commitment from Egypt, much political will to sign [the treaty],” he finished off.
*Translated by Gabriel Pomerancblum
