The government of President Cristina Fernandez has decided to revoke non-automatic licensing requirements which had been placed on certain products before they could be imported into Argentina for consumption, according to a resolution published Friday on the Official Gazette. But earlier in the week Argentina increased the import tariff on a hundred products to the maximum authorized by WTO, which is 35%.
Resolution Nº11/2013 annuls 17 resolutions that had been signed between September 1999 and February 2011 and that had established restrictions on the import of certain products.
Among the products that have now have had their licenses stripped include: paper, home-ware, toys, shoes, motorbikes, bicycle equipment, balls, textile products, shoe materials, metal products, woven and knitted items, tyres, screws, auto-parts, vehicles and tools.
Most of the products ‘liberated’ refer to complaints from Mercosur associates (Brazil, Uruguay and Paraguay; Venezuela only recently became full member) but there still is a long list which remains ‘trapped’.
Import restrictions and an import substitution scheme have constituted pillars of the Cristina Fernandez administration attempt to boost domestic manufacturing and exports and increase the dollar inflow in order to tackle foreign debt.
Non automatic licences include 600 products and force importers to request special authorizations, following complicated paper work and approval can be delayed more than the sixty days contemplated in the WTO ruling for what is described as an ‘exceptional resource’.
Last year Argentina applying these mechanisms and other non-written requisites managed a trade surplus of 12.7bn dollars, up 26.7% over 2011 according to official data from stats office Indec.
The elimination of licences had been repeatedly demanded by different importers’ chambers and manufacturers that needed specific inputs from overseas to keep production.
Earlier in the week Argentina also announced that it was raising import tariffs 35% for a list of a hundred products, in line with a resolution adopted by Mercosur to protect country members from international trade ‘misbalances’
The list published in the Official Gazette includes products such as motorcycles, computers, mobile phones, toys, furniture, tools and foot wear parts. In all cases the new import tariff to be applied as of this week is 35%, the highest authorized by the World Trade Organization.
In December 2011 Mercosur agreed that each member country could increase tariffs on up to a hundred products from outside the block, but respecting the WTP cap.
Mercosur adopted the measure arguing “trade misbalances as a consequence of the international economy situation”. In other words Mercosur members claimed that the big global exporters with the main markets in recession were virtually ‘dumping’ (or trying to) all their excess production in emerging countries at prices which were not transparent as far as costs are involved.
The current increase of tariffs to 35% will be effective until 31 December 2014, according to the resolution adopted by Mercosur.