Brussels, 05/07/2001 (Agence Europe) - The European Union has presented to the four Mercosur countries (Argentina, Brazil, Uruguay, Paraguay) an offer for trade liberalisation in ten years covering 90% of agricultural trade and 100% of the manufactured goods trade, as well as a proposal concerning most services except audiovisual services. Trade Commissioner Pascal Lamy stressed in Brussels that the EU still awaits an offer from Mercosur for the 5th negotiating round which opened on Thursday in Montevideo, in Uruguay. According to the Commission, it would be a "substantial" offer, and politically important, stressed the spokesman for External Relations Commissioner Chris Patten.
The proposal presented by the European negotiator, Commissioner Director General for External Relations Guy Legras, provides for four stages of liberalisation: entry into force of the agreement four years later, 7 years later and 10 years later. Customs duties would be dismantled in a linear manner at each of these stages. The most sensitive agricultural products would be subject to preferential tariffs in the context of quotas. The EU proposes that, to begin with, all non-customs obstacles to trade would be lifted as soon as the agreement comes into force, "unless they are justified" for health reasons, for example. The agreement should immediately cover the technical standards and conformity approval, sanitary and phytosanitary measures, trade defence mechanisms and customs measures.
The very sensitive field of agriculture represents two thirds of current exports from Mercosur to the EU, that is, EUR 8.9 billion annually. Some 60% of these exports (EUR 5.8 billion) already enter the European market freely, stresses the spokesman for Commissioner Lamy. The EU therefore proposes liberalising part of the 3.1 billion in farm imports still subject to customs duties, representing EUR 2.2 billion. In all, 90% of the current agricultural trade from Mercosur to the EU will therefore be liberalised, stresses the spokesman for Commissioner Lamy.
Agriculture would be liberalised in four stages for products subject to customs tax: 1) immediately for a category of products representing a value of EUR 270 million: avocado pears, grapefruit, nuts and tropical fruit, apples and out of season fruit (April to July), oranges and small lemons imported May and October; certain vegetable oils except for olive oil, etc.; 2) after four years for products representing around EUR 600 million: horse meat, onions, garlic and mushrooms; apples and pears imported between January and March, plums and table grapes; pineapples, melons, strawberries and some tropical fruits, dried fruit, table oils; cut flowers, and preparations made from turkey meat; 3) after seven years, some EUR 330 million in additional exports will be liberalised: processed fruit and vegetables (tomatoes, olives, nuts), fruit juices (orange, lemon, grapefruit and tropical fruits), oranges imported in April, limes and tropical fruits, processed chicken meat, some vegetables such as asparagus and lettuce; 4) after ten years, around EUR 1 billion in exports will be liberalised: pigmeat (ham and smoked meat); honey, corned beef and other processed meats, processed fruits and vegetables (frozen orange juice, applied juice, etc.).
Customs duties will be reduced in the context of quotas on a fifth category of particularly sensitive products such as cereals, rice, olive oil, dairy products, chicken, tobacco, fruits and vegetables currently imported in the context of specific agreements such as for bananas. "These concessions will be negotiated on a case by case basis", says the Commission.
Imports of wine and spirit drinks, essentially from Argentina and Uruguay (EUR 60 million annually) will be gradually liberalised, stated the Commission without saying at what rate liberalisation would take place. In parallel, the EU proposes to negotiate an agreement on mutual recognition of geographical appellations and practices in the wine-making industry.
Imports of industrial products from Mercosur, currently accounting for EUR 8.8 billion, would be fully liberalised, in four stages: 1) immediately: products such as paper, wood, textile fibres, leather, certain machine parts, jewellery (representing around EUR 780 million); 2) after four years: machine parts, optical instruments, ceramics, steel products not covered by the WTO agreements, household appliances (worth around EUR 981 million); 3) after seven years: shoes, cars and spare parts, clothing, chemical products which are not yet liberalised; 4) after ten years: a list of products representing EUR 370 million, for which the Commission has not given the content.
Fishery products will also be liberalised gradually: 1) immediately for a category of products representing EUR 5 million including tuna and salmon; 2) after four years for a category worth EUR 338 million, including shrimps and squid; 3) after seven years for a category worth EUR 4 million including frozen meat of hake; 4) after ten years for a category representing EUR 21 million and including frozen fish fillets. The EU has not made an offer for a supplementary category of EUR 127 million, for which it reportedly hopes to verify the possibility of gaining a return to fishing rights in Mercosur waters.
In the services sector, which currently represents 20% of trade between the EU and Mercosur, the EU proposes to immediately liberalise all sectors except for the audiovisual sector, focusing on maritime transport, financial services and telecommunications.
In the public procurement sector, which represents 14% of European GNP, the EU proposes to open up its European,; national, regional and local markets, on the basis of a reciprocal agreement.