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Mercosur Nations to Increase Tariffs to Protect Against “Predatory” Exports

Friday, December 23, 2011
Sandler, Travis & Rosenberg Trade Report

Press articles report that the four members of the Southern Cone Common Market (Mercosur) agreed Dec. 20 to raise import tariffs to protect against what Brazilian President Dilma Rousseff called “an avalanche of predatory exports” from other countries. While details remain unclear, it appears that Argentina, Brazil, Paraguay and Uruguay will each submit a proposal on the goods they want subject to the higher duties and will then work to reach agreement on a final list of about 100. They would then each be able to increase their individual tariffs on those goods to as much as 35%, the maximum allowed under World Trade Organization rules. A Dow Jones article adds that the higher duties will take effect in January and remain in effect through 2014.

The tariff increase decision was taken at a summit of Mercosur leaders held this week. Also at that meeting leaders reportedly agreed to accept Ecuador as a member, again failed to approve Venezuela’s request to join, and signed a free trade agreement between Mercosur and the Palestinian Authority.

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