Last Thursday's speech by Benita Ferrero-Waldner on EU-Latin American relations brought a very timely clarification to the Commission's orientations towards this continent, which is so important to Europe on political, economic, cultural and historical levels. The European Commissioner for External Relations defined realistic objectives, leaving aside, finally, the project for a colossal free trade zone with Mercosur, which over so many years represents a kind of fetish, untouchable and at the same time unworkable, and the cause of so many misunderstandings and confrontations.
European Parliament on its own. In last week's column I underlined (EUROPE 9308) that Mercosur did not figure among the countries or groups of countries with which the Council sought negotiations for a new generation Free-trade Agreement (FTA). After the semi-failure of the EU/Latin America Summit in May (discussed in EUROPE 9196), the need to redefine reasonable objectives was obvious. There is now just the European Parliament allowing itself to be dazzled by the enormity of a free trade zone incorporating all the different entities: the EU, Brazil, Argentina and the old and new members of Mercosur. Daniel Varela Suanzes-Carpegna, the rapporteur, ecstatically announced that this was “the largest FTZ in the world!”, immediately followed by a mass of MEPs eager to lap this rhetoric up (with the exception of the Greens Group, which highlighted demands for biodiversity and sustainability in the project instead of the “insane race towards the opening up of the services market to multinational companies”).
Apparently to make such a project acceptable, Parliament inserted an incredible number of conditions into its lengthy resolution, including Mercosur's commitment to promote common rules on trade, social and environmental matters, and target sectors for liberalisation such as investment, public procurement, competition rules, etc., as well as “a binding mechanism for settling disputes”. The agreement pictured would go “well beyond respective WTO obligations” and would be subject to specific agreements on wine and liqueur, protection of geographical indications and the application of sanitary, phytosanitary standards, as well as animal welfare, without forgetting a “clear and stable regulatory framework” for maritime transport and aviation. Nothing has been left out. And all this will be completed with a “definitive calendar” for the rapid conclusion of the negotiations!
An unrealistic catalogue. Is there a need for underlining the totally unrealistic character of this catalogue? Mercosur does not have the adequate political and administrative structures to negotiate this kind of agreement as carefully described by the European Parliament, and even less so the means to manage it. Mercosur was already unstable and working episodically when it consisted of four Member States. It has become adventurous and unpredictable with new accessions decided upon or planned. The four founding countries (Brazil, Argentina, Uruguay and Paraguay) based their enterprise on two major principles: the “democratic clause” and the market economy. The Venezuela of Hugo Chavez and that of Hugo Morales' Bolivia are following paths that are perhaps more appropriate to their countries but which are not compatible with an agreement that covers the areas cited by the EP. Negotiations had already floundered in 2004, before Mercosur's transformation: it's impossible to tell on what basis they will be resumed. It is to be hoped that the new Trans-Atlantic EU/Latin America Parliamentary Assembly will be based on work carried out on real issues, not on demagogy and that the European co-president Ignacio Salafranca guides them so that this Assembly becomes the “political arm” of relations between the two continents.
Openings. Ferrero-Waldner's speech illustrates ideas and orientations covering EU relations with all Latin American countries, with a lot of openings but underlines that the rule of law, democracy (which does not only mean the periodic organisation of elections) and legal security remain indispensable if investments are to materialise and cooperation put into practice. In her opinion, recent decisions by Latin American countries in this connection are not encouraging.
Detailed studies have also revealed areas of cooperation that can be developed by highlighting investment in infrastructure and bio-fuel. There's a lot to do, including trade, if we free ourselves from the myths.
The Brazilian colossus deserves some specific considerations. This will be for tomorrow.
(FR)