Argentina, Brazil To Create Automotive Trade Committee | The ...

Argentina and Brazil will create a bilateral committee to study automotive trade between the countries, Argentina's Industry Ministry said in a statement Monday.

Plans for the committee emerged from a meeting between Argentine Industry Minister Debora Giorgi and Brazilian Foreign Trade Secretary Tatiana Prazeres, who met to discuss trade tensions between the countries.

Argentina's government has been moving rapidly to limit imports of all kinds in a bid to protect its trade surplus, alarming officials in Brazil, its top trade partner.

"Argentina isn't a problem for Brazil but rather a part of the solution," Giorgi said after the meeting.

Giorgi's comments come after Fernando Pimentel, Brazil's minister of development, industry and foreign trade, said last month that Argentina is a "permanent problem."

"We have good political relations, but economically it is difficult to deal with them," Pimentel said in an interview with Dow Jones Newswires.

Officials from the two countries will resume trade talks in two weeks.

Argentina's trade surplus has been declining in recent years as growth in imports surpasses rising exports.

Meanwhile, the trade deficit with Brazil has grown substantially. Last year the deficit was $4.2 billion, compared with about $3.4 billion the previous year.

Argentine officials are particularly concerned about automotive and auto parts trade. Argentine manufacturers sell the vast bulk of car exports to Brazil. Yet many of those cars are made largely with parts imported from Brazil.

Argentine officials want this to change and are pushing local companies to produce more of those parts here.

In a somewhat strangely-worded statement, Giorgi said Argentina and Brazil should work together to "impede multinational companies from liquidating the crises in their countries of origin with profits made in Mercosur."

Mercosur is a customs union whose founding members include Argentina, Brazil, Paraguay and Uruguay.

A spokesman for Giorgi said the minister simply meant to say that companies such as European automobile makers should do more to integrate production in Mercosur and not focus on maximizing profit by producing different parts in different parts of the world.

Source: The Wall Street Journal

Source: http://www.theinformationcompany.net/2012/02/argentina-brazil-to-create-automotive-trade-committee/

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