Mercosur, EU Try To Break Free-Trade Deadlock

By Agence France-Presse Representatives of South America's Mercosur trade bloc and European Union negotiators prepared Aug. 9 to break last month's logjam to create a free-trade zone between the two blocs. "There is no room for negotiating tactics," said Regis Arslanian, the negotiator for Mercosur, which comprises Argentina, Brazil, Paraguay and Uruguay. "They will have to put their cards on the table." The two sides will meet in Brazil's capital Tuesday through Thursday. An EU-Mercosur agreement would eliminate tariffs between the two blocs and raise importation quotas for a limited number of agricultural products sold in Europe. Arslanian said that Mercosur broke off last month's talks in Brussels because the EU offer was "insufficient." Europeans had sought lower quotas than those currently in force. In 2003, 70% of Mercosur exports to the European Union were primary goods, mostly agricultural. However, of EU exports to Mercosur, 89% were secondary, or manufactured, goods, while only 7% were primary goods. Europe is seeking further concessions allowing it access to Mercosur's services sector, investments and government procurements. Arslanian said the outcome of this week's meeting in Brasilia will determine whether a deadline for reaching an EU-Mercosur agreement will be met by Oct. 31. Copyright Agence France-Presse, 2004