12/05/2021

Opening up to the world unilaterally is as anachronistic as isolating oneself from it

Our mandate in the Pro Tempore Presidency of Mercosur is to defend the regional integration process formally started thirty years ago with the signing of the Asunción Treaty.

The Treaty of Asunción, a milestone in the history of regional integration, is clearly based on Argentine and Latin American thinking. Our political leaders forged what would gradually become a conviction: it is necessary to align the interests of our countries in order to have a strong presence in the world and make our voice heard. Alone we can do so little; together we can do so much.

This 30-year-old legal instrument was the starting point for innumerable achievements, such as the consolidation of democracy, the end of conflict hypotheses, the growth of intra-zone trade, increased levels of investment and the free transit of citizens, among many others. The first article of the Treaty called for the “establishment of a common external tariff and the implementation of a common trade policy vis-à-vis other States or associations of States and the alignment of positions in regional and international economic and trade fora”.

The process of regional integration is currently at a difficult juncture. Some members consider that the bloc constricts their international interaction and hence demand to negotiate individually with countries and regions. While openly claiming that we should “open up to the world”, they demand greater external negotiations than we are currently engaged in, some of which offer unclear benefits for our productive sector. These arguments, rooted more in ideology than in pragmatic foreign policy objectives, strike at the heart of the Treaty of Asunción. 

Argentina, currently holding the Pro Tempore Presidency of Mercosur, seeks to reconcile positions with a general objective set by the President of the Nation and the Minister of Foreign Affairs: to strengthen the regional bloc. This is the aim of the Treaty of Asunción, which in our country is considered superior to the laws. This in no way means ignoring the shortcomings of the bloc, but rather being certain that the solution will never be the atomization of our fellow countries, but the consolidation of our ties.  

Let us briefly analyze the observations of some members of the bloc: they ask us for rapid trade opening and greater dynamics in the bloc's external negotiations. Faced with the repeated concept that it is necessary to "open up", heard daily in the media and from the mouths of some negotiators, it is necessary to state the obvious: almost no country in the world "opens" its trade system gracefully and unilaterally without a profound negotiation in between to obtain similar concessions from other partners. If the success of one country were to be solved simply by lowering tariffs, all states would do so immediately.

So why do developed or developing countries spend years or decades negotiating extremely complex trade agreements? Why did it take so much effort and hundreds of officials to negotiate NAFTA or now the T-Mec? Why did the EU dedicate decades and thousands of experts to articulate such a sophisticated integration process? Why did the RCEP start negotiations in 2012 and ended them in 2020?

The answer is that these processes take time because the reduction of tariffs is part of a sophisticated negotiating process in which concessions are sought from the parties. Issues of intellectual property, trade in goods and services, designation of origin, electronic commerce are addressed, among a wide range of topics that require a huge mobilization of resources and expert personnel. In addition, if it is approached responsibly, they carry out impact studies that allow for the anticipation of the effects that the reduction of tariffs will have on the different sectors of the economy.

If Mercosur decided, as some claim, "to open up to the world", then it would have nothing to offer in its external negotiations. As a negotiator, if I seek access to Argentine meat or medical equipment, or to auto parts or milk dryers, among thousands of national competitive products in the international market, I have to be able to offer something in return. I ask my counterpart for access to Argentine oranges and he responds with a request to open the mango, to put a case that simplifies but serves as an example. Unilateral opening implies giving up the main tool we have to get access for national products.

In a complex world, in which the pandemic has further exposed the toughest mechanisms of negotiation between countries, thinking of a unilateral opening is either an ideological position without real support or a lack of professionalism or naivety, or perhaps it comes from a country that has absolutely no productive sector to protect or even to develop in the medium term.

Today what we need is not to open up but to connect to the world, intelligently and considering the needs of the productive sectors.

On the other hand, some partners ask to initiate a greater amount of external commercial negotiations. They assume that Argentina does not pursue this objective. However, it is a claim that is not consistent with reality. Mercosur currently has one of the most active commercial agendas on the planet. We are proactively moving forward with seven partners comprising 36 countries: the European Union, EFTA, Canada, Korea, Singapore, Lebanon and Israel. To achieve this, we carry out permanent consultations between the different ministries involved, with the provinces and with the productive sectors, in order to incorporate their sensibilities throughout the process. Some of these courses of action are being delayed for reasons beyond Argentina's control. This is the case of the EU and EFTA, for example, where European public opinion strongly questions the negotiations on environmental issues in the Amazon. At the same time, Argentina has proposed to negotiate with Nigeria, Tunisia, the Eurasian Economic Union and all the countries of Central America and the Caribbean.

This extremely complex external agenda absorbs all our efforts and the work of our negotiators. There is no more capacity to open new fronts as long as we are not closing the open processes. This, if we want to maintain a level of professional negotiation that strives to defend the interests of Argentina and Mercosur. The only possibility of negotiating multiple simultaneous agreements that come additionally to those indicated is to make the decision to lower all tariffs without regard. This would be simple and would allow all fronts be addressed at the same time. But, like I said before, no one who understands how the world works would.

Argentina has the responsibility of installing this debate to continue consolidating a project that is key to sustainable development. From the presidency of the bloc, we try to continue with this line of reflection, attending and taking care of the concerns of our partners, but without losing sight of the fundamental question: Mercosur is a State Policy that we must defend and deepen.

Jorge Neme is a sociologist and current Secretary of International Economic Relations of the Ministry of Foreign Affairs of International Trade and Worship and National Coordinator of Mercosur for Argentina. He is an expert in public investment management through Multilateral Credit Organizations and in rural and regional development.