Talk:Mercosur

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Contents 1 It's not a trade bloc, and it's more than a FTZ: It's a Customs Union 2 Mexico is not an associate 3 Chile's reasons to avoid full membership of Mercosur 4 Mercosur not a Free Trade Zone? 5 Article needs immediate attention 6 Bolivia as a full member in the future 7 Venezuela status 8 History 9 Free trade 10 Guaraní as official language: probably in Mercosur, probably not in Bolivia 11 Venezuela

[edit] It's not a trade bloc, and it's more than a FTZ: It's a Customs Union

This really needs to be clarified, because this page is simply misleading as it is. MERCOSUR has a common external tariff. This joint consession of political power onto MERCOSUR from the member states -in addition to a future popularly elected Parliament, a single position in the WTO and a (at least theoretical) pact to negotiate trade as one unit - makes MERCOSUR much more than a FTZ or a trade bloc.

The wiki page on trade blocs also makes this clear, as it lists MERCOSUR beneath the CSN. Additionally, the page on Customs Unions accurately lists MERCOSUR as such.

For the above reasons, I've changed the opening paragraph to recognize MERCOSUR as a CU. If you still feel this is not accurate, I'd be happy to provide an ample list of sources that susbstantiate this.--Puck85 21:13, 18 June 2006 (UTC)

It is known, amongst economist that, nominally, it is the objective (or aim) of Mercosur to be a Customs Union, but in practice, at least until now, it has not fully achieved it. Just to give an example, Uruguay signed in 2004 an exclusive FTA with Mexico; so either Mercosur does not act as a unit to negotiate trade, or it allows individual-member preferential TAs as long as they are FTAs, which is even worse. If Mercosur is a full CU, then Argentina, Brazil and Paraguay are in disadvantage; whatever Mexico exports to Uruguay under their FTA can be exported directly and tariff-free to the rest of Mercosur (a true CU has no border checkpoints for internal trade: that's the whole purpose of a CU, to facilitate internal trade, where the common external tariff is the necesssary condition, but not the end in itself).

Let me explain; an FTA is an alternative to a CA (not a higher degree of integration, as it is sometimes wrongly assumed). FTAs promote the same tariff-free trade amongst the member countries, but allows each one of them to establish their own external tariffs with non-member countries. Under NAFTA; for example, Mexican products can be shipped freely to the US and Canada (and viceversa), but Mexico still has the right to restrict (or open) trade with countries with which the US opens (or restricts) trade (e.g. with Cuba or Uruguay). While this seems a superb idea, it poses problems: if Mexicans import tariff-free, say beef, from Uruguay, under the Mex-Uru FTA, it might be shipped again tariff-free to the US under NAFTA, a country that restricts Uruguayan trade. The only way to prevent this is to set up border inspections and rules of origin for the products. The EU, which is probably the only full CU in practice, tried to minimize internal trade related costs (non-tariff), time lost at checkpoints and the paperwork associated with rules of origin. The only way to do so was to establish a common external tariff, which in turn means that no single member can negotiate PTAs or FTAs with any non-member; they all act as a single entity in ALL negotiations, be it WTO or individual TAs. Once a product enters the EU through any port, it does not have to go through any border inspection at all, (or any border for that matter!), and can be shipped as freely as any other product is shipped from the Province of Buenos Aires to the Province of Córdoba: it functions as a full CU.

Mercosur fails to act as a single entity by allowing their members to negotiate FTAs independently (either privately or as a precondition to become an associate member of the bloc). There cannot be a common external tariff as long as Uruguay has a FTA with Mexico. It is also the case that Brazil has signed PTAs with Mexico in certain areas (mainly in the automotive sector). Moreover, Mercosur restricts trade amongst member countries in sensitive areas, mainly through VERs (voluntary export restraints) or VRA (voluntary restraint agreements). Brazil and Argentina have done so several times. And, to be honest with you, I do not know if Mercosur does negotiate in WTO as a bloc or not. I do know that the EU negotiates under the "European Communities" [1], but at least, until know and as far as I know, Mercosur members negotiate independently (there is no "Mercosur Communities" bloc).

True, you are right in saying that Mercosur is more than a mere FTA today; and aims to be much more in the future (with the eventual creation of a Parliament), but, at least technically today, and in practice, it is not a full CU yet.

--Alonso 05:03, 22 July 2006 (UTC)

You're right to point out that Mercosur has a flawed custioms union, but nothing (not even the "model" that the EU provies) is an ideal type. This wiki certainly deserves several sections on the flaws and gaps in Mercosur and its CU, but when defining what Merosur is and what it aspires to become, we cannot say that it is a FTZ, as this site used to state. If we read the Treaty of Asunción, we find that the phrases FTZ and FTA are never used. Ouro Preto, which expanded upon Asunción, also never mentions such terminology. To have defined Mercosur as something that it is not and does not aspire to be was incorrect. While Mercosur justly earns its reputation as a "flawed customs union," it is still the single most successful customs union among "third world" blocs.

I'm sorry to disagree with you in almost all your arguments. As I tried to explain before, the purpose of the CU is to simplify inter-regional trade by having no chekpoints at the borders of all members, which can only happen if nothing needs be checked (that is, all products flow freely, ergo, free trade). Therefore it makes no sense for a CU to exist if the bloc is not also an FTA. Even if Mercosur defines itself as a CU, this is preconditioned to the existence of an FTA. That is, if Mercosur is a CU it must be an FTA (see customs union). Therefore there is nothing wrong in saying that Mercosur is an FTA. In either case, it could be said that Mercosur is a theoretical CU that funcions as a FTA in many matters. Actually the way that Mercosur defines itself is as a "Common Market" (which obviously implys CU and FTA, whether they are flawed or not).

Secondly, the model of the EU is the prefect customs union: there are no checkpoints for inter-regional trade, all members have agreed on a common external tariff including FTAs with non members, and all members negotiate everything (related to trade) as a bloc. What are they missing? Sure, negotiations have been bumpy, but they are functioning as a full CU. That has not been the case with Mercosur: Uruguay has signed an FTA with Mexico. Moreover, with VRAs, Mercosur is not even allowing free trade, but that is another story.

Thirdly, Mercosur is not the most successful customs union amongst third world nations; other successful CUs are the Economic and Monetary Community of Central Africa, the Southern African Customs Union and the West African Economic and Monetary Union amongst others. From these three SACU is the most successful CU amongst third world nations, and the oldest in the world, having been implemented since 1910.

--Alonso 03:50, 6 August 2006 (UTC)

Your assesment of SACU is as interesting as it is unestablished. The WTO itself has stated that Mercosur has the most solid CU outside of Eurpoe (that's not to say that isn't heavily flawed). For readings on this, I'd reccomend the works of Mercedes Botto at FLACSO and the University of Buenos Aires. Generally speaking, I think you're inventing arguments that I haven't made or even implied. I never wrote that Mercosur is not a FTA. I wrote that to state it as such is "misleading." I never said the CU was perfect or complete (isn't it also presumpuous to redefine an incomplete process simply because it isn't complete yet?).

I truely don't mean to offend, but to say that the EU's CU is "perfect" shows little regard for the principles of social sciences. Here's one grotesque imperfection off the top of my head: Last Fall's WTO agricultural debates featured France and a short list of other nations that wanted to take a harsher line against US policy than the rest of Eurpoe. Untill you refine such language and reference literature establishing that political scientists do not call Mercosur a CU, I suggest that you move on or use your criticisms constructivly. Making a heading about Mercosur's flaws on this Wiki would be a start.--Puck85 19:04, 16 August 2006 (UTC)

I believe you are missing the whole point; my criticism has never been destructive, and if you have felt it that way, it might be due that we are talking about apple and oranges here, or that you are talking the discussion into a personal level. I am not a political scientist, therefore I do not know whether the political science, as an academic discipline, describes CUs in qualitative and subjective ways. (I doubt it). But I am an economist, and as such, I am a social scientist, and I do show regard for the principles of my profession. They way the discipline of economics (or international economics) describes a CU is quite simple: an FTA in which all members agree to have a common external trade policy (i.e. tariffs) to avoid internal inspection of traded goods amongst members. This is a positive statement or definition, not a qualitative and subjective one. The EU is the perfect CU (a positive argument vs. a normative argument) in that the definition of a CU applies to the EU: it is an FTA with a common external policy. Simple. France might want to take a harsher stand against US policy, but all members must agree to it, in the same way as Florida wants to maintain higher agricultural subsidies (e.g. sugar) but the US as a federation of 50 states, has to agree to it. Neither France, nor Florida can set up trade policies unilaterally. Therefore, EU functions, in all aspects, as the "perfect" customs union. All requierements for an CU (FTA and common external policy) are met. I do not understand your grotesque (sic) imperfection. This is not the case with Mercosur given the reasons expounded above (related to the VRAs amgonst Brazil and Argentina and the unilateral FTAs of Uruguay). I will not repeat myself in that explanation. As for SACU, I would recommend you to read literature on it, or at least the English wiki article (see: Southern African Customs Union), but please note that SACU is a CU, while Mercosur aims to become a Common Market and therefore has set up stronger supranational institutions to meet that goal, which would explain your (unreferenced, too) comment on WTO saying that Mercosur is a strong bloc. I would also prefer that you avoid ad hominem criticism. If you insist, then at least give me the courtesy of pointing out (1) a comment where my languange was not refined, and (2) a comment that was a desctructive criticsm.--Alonso 23:30, 17 August 2006 (UTC)

Just a quick comment, it is not true that i.e Uruguay can import something from i.e mexico and then re-export it to the Mercosur, there are rules about the origin of the merchandises. If goods have more than certain amount of components extra-zone they will pay taxes. Like for example bicycles made in Uruguay are not imported without arancel into Argentina, since they have components made in china.

Martin1homas 01:26, 21 February 2007 (UTC)

[edit] Mexico is not an associate

Is an observer waiting for approval to associate

[edit] Chile's reasons to avoid full membership of Mercosur

I deleted a reason arguing that Chile hadn't take part of Mercosur as full member (territorial disputes with Argentina).

Chile hadn't joined the Mercosur in the late 90's cause the country had lower and uniform import taxes (aranceles aduaneros) than the alliance (Mercosur was born as a customs alliance and not as FTA). Also monetary politics and exchange rates politics differed.

After the asiatic economic crisis Chile argued another reason to not join the agreement: Chilean economy es very small compared with argentinian and brazilian ones and could suffer their influence during the crisis. As example Uruguay was terribly affected by Argentina's economical colapse of these last years. Paraguay also was affected by this crisis and brazilian inestabilty.

Baloo rch 00:50, 30 May 2004 (UTC)

Source for new associate members: BBC News Online 8 July 2004 Secretlondon 00:57, 9 Jul 2004 (UTC)

This is right --Guillermog 19:05, 14 Sep 2004 (UTC)

However other news sources just say Venezuela - but they are dated earlier. No info on official Mercosur web site. Secretlondon 01:23, 9 Jul 2004 (UTC)

It should be also noted that the USA has made numerous efforts into "converting" Chile to the NAFTA, if only to prevent a Pacific opening to the countries of Mercosur.LtDoc 22:20, 2 August 2005 (UTC)

[edit] Mercosur not a Free Trade Zone?

The article implies that Mercosur is a free trade zone - however if Argentina is putting duties on Brazilian goods then surely it isn't? Secretlondon 00:59, 9 Jul 2004 (UTC)

This is right too --Guillermog 19:05, 14 Sep 2004 (UTC)

It must be seen not as a pure trade zone, there are several restrictions, although trade is significant anyway. And it has a common minimum external tariff.

Martin1homas 01:29, 21 February 2007 (UTC)

[edit] Article needs immediate attention

Hi. I've just read the article and, well I'm sorry but it doesn't look so good. It's superficial, very incomplete and, as it stands right now, it's of no help for anyone who wishes to understand how the agreement works (and how it came to be). At the very least, this should be listed as a stub. And that final paragraph about the "merge" with the Andean Community is just plain wrong. The paragraph implies that both entities ceased to exist and a third one appeared to replace them both, which was certainly not the case. All they did was sign a cooperation agreement and a letter of intentions for a future (sine diem) negotiation to integrate all the subcontinent (which would most likely occur under the flag of the Mercosur, anyways). Regards, Redux 00:41, 6 Jan 2005 (UTC)

---

"It has a south and central America integration vocation."

This makes no sense and the linked-to articles seem completly irrelevant. - 28 November 2005

[edit] Bolivia as a full member in the future

According to local media sources (http://www.clarin.com/diario/2005/12/19/um/m-01110401.htm), Mercosur's observer in Bolivia's election Carlos "Chacho" Alvarez is planing of proposing Bolivia as a full member.

[edit] Venezuela status

Please pay attention to the status of Venezuela, it is not yet full member, it is what in spanish is called "estado parte en proceso de adhesión". That means that it its begining the process to become member. Barcex 13:54, 12 January 2006 (UTC)

[edit] History

some personal notes for those looking for history...

The Treaty of Asuncion The objective of the treaty is clearly expressed on the first article: “The States Parties hereby decide to establish a common market, which shall be in place by 31 December 1994 and shall be called the Common Market of the Southern Cone (Mercosur).” The Treaty lays down a date where an effective common market will take place. It indicates that the regime established in Asuncion is transitory, not instantaneous. The treaty lays down the rules for this transition period to be accomplished by the following convention to take place in 4 years. Of its main provisions the treaty listed four instruments to form the common market: 1) The trade liberalization program for virtual elimination of tariffs: The Treaty of Asuncion set forth a program of progressive trade liberalization among the four countries that had been implemented since its entry into force in 1991. That program was concluded on December 1998 for Brazil and Argentina and on December 1999 for Paraguay and Uruguay. “From 1991 to 1994, 95% of intra-regional trade was liberalized, with the virtual elimination of tariff and non-tariff barriers” . 2) The Common External Tariff (CET): It’s the basic element of a customs union, which establishes the level of tariff protection imposed on third country’s products to enter into the integrated market. 3) The coordination of macroeconomics politics in fields like foreign trade, fiscal and monetary policies, foreign exchange and capital movements, among others. 4) The adoption of sectoral agreements: they are specialized sectors that work to facilitate and reinforce the integration process. The Treaty also set out the organizational structure for the transition period : The Council of the Common Market (CCM) The Common Market Group (CMG)

The Protocol of Ouro Preto On December 1994 the Protocol of Ouro Preto was signed ending the period of transition of Mercosur. From this date on, Mercosur has its own definitive institutional structure to negotiate its way to the Common Market. Besides that, the Protocol of Ouro Preto establishes the judicial personality of Mercosur, which gives power to negotiate – as a regional group – international agreements. The main aspects defined by the Protocol of Ouro Preto are: 1) The judicial nature of the organizations of Mercosur and the decision-making system: Mercosur has an intergovernmental structure, that is, the governments negotiate among themselves, not existing a supranational authority (organization). The decisions are always made by consensus. There isn’t the possibility of vote. 2) The organization: new organizations are created and most of the transitory ones of the Treaty of Asuncion remained. 3) Reinforcement of laws: since its laws do not have direct application to its member-states, each state has to implement measures to incorporate laws. 4) The judicial personality: it recognized Mercosur’s judicial personality of international law, which makes possible to the member-states be represented as a group in the international arena. 5) Official language: Portuguese and Spanish are the official languages. The work documents are to be elaborated in the language of the country hosting the meeting.

[edit] Free trade

Customs Union is also not a very good description. RTA (Regional Trade Agreement) is what the PhD's I read (while I try to get mine ;) refer to it as. Here are a couple references: Author: Duina, Francesco G., Title: The social construction of free trade : the European Union, NAFTA, and MERCOSUR / Francesco Duina. Published: Princeton,N.J.Princeton University Press, c2006. Author: Porrata-Doria, Rafael A. Title: MERCOSUR : the common market of the southern cone / By Rafael A. Porrata-Doria, Jr. Published: Durham, N. C. : Carolina Academic Press, c2005. —The preceding unsigned comment was added by La Ley (talk • contribs).

[edit] Guaraní as official language: probably in Mercosur, probably not in Bolivia

Checking the apparently informed Oficialidad del guaraní part of Guaraní Portal from the University of Mainz, it seems that Guaraní has become an official language of Mercosur, but it is not an official language at Bolivia -though in Bolivia there are intense political developments as to the status of the indigenous populations. But I do not actually speak Spanish (that section's of the portal language) to be 100% sure. Please check the information. --Michkalas 00:11, 9 December 2006 (UTC)

Based on that link it seems guaraní will become an official language in Mercosur. It is co-official with Spanish in Paraguay and in the Argentinian province of Corrientes. --Alonso 02:11, 9 December 2006 (UTC)

Indeed. I have found something in English:

“

Real World Radio (RWR) Guarani to be Declared MERCOSUR’s Official Language 23/11/2006 - News MERCOSUR’s Ministers of Culture approved a request of the Paraguayan government for Guarani language to be declared as the third official language of the regional block, along with Spanish and Portuguese. MERCOSUR’s members are Argentina, Brazil, Paraguay, Uruguay and Venezuela. The resolution will be presented at the postponed MERCOSUR meeting, which will be held on January 18th and 19th in Brasilia city, Brazil. As was expressed at the ministerial meeting, the initiative aims to “the integration of the region’s traditional communities”. The adoption of the language will require the simultaneous translations of the MERCOSUR’s official documents. Guarani was declared official language in Paraguay in 1992. It is estimated that 7 million people in the region speak this language. Paraguayan organizations have been demanding this for several months, trough a campaign that included thousands of signatures and messages, which were sent to the block’s presidents. Sources: Prensa Indígena

”

[2]

So we have to follow the subject and see what happens. --Michkalas 13:50, 9 December 2006 (UTC)

I dont think so. If Guarani was to be accepted in Mercosul as official language so would all the native languages in Brazil, Argentina and Uruguay and it would make this impossible. I dont think "Prensa Indígena" could be classified as a impartial source of information. I am not stating that it should or should not be included as an official language, I am just saying that this should not be included in the article because it is not true, at least yet, and i dont think it will.Alvaroludolf 13:25, 7 February 2007 (UTC)

The difference between the Amerindian languages of Brazil, Argentina and Uruguay is that none of them is co-official at the national level with Spanish. Guaraní is an official language of Paraguay.--the Dúnadan 03:06, 8 February 2007 (UTC)

Indeed a good point but I still doubt it will happen and we still need an impartial source for this possibility. As important the Guarani can be to Paraguay I don’t know if it have the same importance or expressiveness to the bloc as a whole but to be honest I am not very familiar with this subject in Paraguay either. Anyway we should only place it in the article if it becomes a real fact or a real possibility both with a reliable source of information. Alvaroludolf 13:44, 8 February 2007 (UTC)

True, the important thing is to wait and see if Mercosur has/will accept Guaraní. In your opinion it might not be important for the expressiveness, but in my case, I am familiar with the fact that the European Union has accepted all co-official languages of State members (e.g. Basque and Catalan). Importance is a tricky thing, and languages are, for the most part, the identity of a nation, a culture, a region, an ethnicity, within multi-cultural countries. --the Dúnadan 14:55, 8 February 2007 (UTC)

Alvaroludolf, there is no reason to worry. As I wrote in my original comment, we will include something when there is a final decision. No news agency or newspaper or website is impartial. But Real World Radio was the only source in English. In Spanish/Castillian the issue was more widely covered.--Michkalas 15:07, 8 February 2007 (UTC)

[edit] Venezuela

I know the executives have approved Venezuela's membership to Mercosur. But, has Venezuela's membership been already ratified by all legislatures of the member states, or is it still in the process? --the Dúnadan 16:54, 25 March 2007 (UTC)