THE MERCOSUR ROUTINE

Situation can force despair or trigger creativity

It is Mercosur Summit time again. This time in Paraguay. The presence of the new Argentine president Mauricio Macri is likely to be one of the most attractive items for the media. After all, he represents a significant change after 12 years in which Argentina espoused a totally different political regime under the Kirchner presidencies.

And there is an additional side-line: the current confrontation between Macri and Venezuela’s Maduro might provide some interesting headlines and reports from the accredited journalists. Apparently the Argentine president will raise the issue of human rights and political freedom in Venezuela. And as already reported in this column, the Venezuelan reply is unlikely to be friendly.

The skirmish is bound to trigger a debate in Argentina. Kirchner supporters will immediately accuse Macri of being part of a conspiracy to destabilize a democratic and popular (populist?) leader. The other side will reply that Human Rights do not have an ideology and that the same standards should apply to everybody,

Moreover, such a debate will rekindle a discussion which is discreetly taking place among some political analysts. They are wondering if Macri’s PRO means that a new kind of modern — and democratic — model of centre right political party is being born in Latin America. They are thinking in terms of a political format which can make social and human rights objectives, coexist with market oriented economic policies which — in addition — include some market regulation aimed at expanding democracy to aspects which — up to now — were a monopoly of the progressive side of the political spectrum.

In any case, should the controversy between the two presidents erupt, it would be simply one more obstacle in the way of this particular summit achieving much. There are others. First, there is the fact that the main partner, Brazil, is in the midst of a deep political and economic crisis. Not the best position to enter new long term commitments. In the case of Argentina, a number of sources suggest that different local government departments from within and without the Ministry of Foreign Affairs still have to agree on who is going to do what, and that, currently, there seem to be other priorities for the country’s economic and diplomatic teams. Some more or less as important as Mercosur but definitely more urgent.

This whole scenario would change dramatically if there were a solid hope about the possibility of finally reaching a free trade agreement with the European Union. The issue has been around since the birth of Mercosur approximately two decades ago. Both sides blame each other for the failure. And they are both probably right: simply put, there are too many interests to harmonize. Many say that this single item is the most frustrating issue on the Mercosur menu.

The stagnant Mercosur does not affect the five member states in the same way. Possibly, in the case of Venezuela, the political crisis simply pushes Mercosur out of the agenda unless it has to do with politics. Brazil and Argentina have a problem but have other economic and trade conflicts which create a more urgent and focused agenda. which also offers more options to explore. The two smaller partners, Uruguay and Paraguay get the short end of the stick. Mercosur limits their options and does not offer much in terms of compensation.

This situation can force despair or trigger creativity. Luckily, in the case of this week’s summit it has been the latter.

The Paraguayan Deputy FM announced last week that a list of approximately eighty non-tariff barriers for products manufactured and traded within the bloc had been identified. The idea is to scrap the antidumping measure and countervailing duties. This would ease up Uruguay and Paraguay’s life in Mercosur, allowing for increase trade, and, perhaps, more foreign investment.

It would be a good way of starting 2016. Not a break away from routine, but an interesting step in the right direction.

@andresfederman

CREDITS: BUENOS AIRES HERALD