Venezuelan exports exempt from Mercosur tariff
Consensus was reached for the automotive and agricultural sectors
The Venezuelan Presidential Commission within the regional bloc formally announced that, as of January 1, several trade agreements came into effect. Also, it noted that "any type of product may be exported to Brazil, Argentina and Uruguay without being subject to export tariffs, thus marking the start of export activities through Mercosur. This market waives 100% of trade fees and tariffs for Venezuela."
The Commission, a branch of the Ministry of Foreign Affairs, indicated that Venezuela "maintains 777 tariff codes with Brazil and 610 with Argentina for economy-sensitive items, and many will continue to be subject to those fees for a significant number of years, several of them until 2018. In doing so, Venezuela will protect its steel, metal, textile, footwear, plastic and other industries."
With regards to the automotive sector, "negotiations will take place in 2013 to reach consensus on specific trading standards to secure favorable conditions for our domestic industrial sector. In the meantime, current conditions will remain in place."
In relation to the agricultural and food sectors, negotiations under the Commercial Freedom Program with Brazil and Argentina have produced "preferential treatment for commodities of an extremely sensitive nature to Venezuela, such as poultry, pork and cattle meat, shrimp, fresh tomatoes, fresh onions, garlic, carrots, coffee, rice, milk and dairy products, wheat and corn flour, starch, cereal pellets, raw oil (soy, sunflower and palm), refined oil, margarine, cold meats, processed meat and fish, cocoa and chocolate derivatives, pasta, cookies and other baked products, orange and citric concentrates, mayonnaise, ketchup, premixed products and many others; as well as exemptions for the sugar sector (strictly governed by Venezuelan law)."
According to the Commission, "preferential treatment for the agricultural sector is aimed at scaling toward full tariff exemption by 2018 under a frozen-preference regime to ensure suitable development of the domestic production sector."
Step by step
The government also highlighted that agreements were executed through the Latin American Integration Association, namely the Partial Scope Agreement for Economic Complementation with Brazil and Argentina and the II Additional Protocol to the Partial Scope Agreement for Economic Complementation with Uruguay.
The Commission also stressed that "this is a very important course of events since those instruments contain the development of Venezuela's Trade Freedom Programs with its Mercosur allies, based on gradualness, flexibility and equilibrium, recognition of asymmetries and preferential treatment, as well as principles of food security, means for subsistence and rural development," adding that Venezuela will become a formal member of Mercosur's Common Nomenclature as of 5 April 2013.
Translated by Félix Rojas Alva
President Nicolás Maduro is not only the heir to the throne, but also to an economic crisis which demanded urgent measures to rectify the course. The crisis showed up in two aspects: a 50% inflation estimate, and shortage of staples ranging between 70% and 98%. These issues might hit the President's poor popularity; considering his feeble electoral victory of 1% over his challenger.