Mercosur Common External Tariff slashed by 10%
Mercosur member countries have reached an agreement to reduce their Common External Tariff by ten percent. With some exceptions, the tax is levied on goods imported from nations outside the South American bloc and varies from product to product.
The move was announced at the ordinary meeting of the Mercosur Council, held before the 60th Summit of Heads of State of Mercosur and Associated States, which took place in Asunción.
In announcing the joint decision, Paraguayan Foreign Minister Julio Cesar Arriola said the measure will help “improve the competitiveness” of the bloc’s member nations as well as “the access of our productive sectors to supplies and capital goods.”
In a statement released Thursday (21), the Brazilian ministries of Economy and Foreign Affairs note that the ten percent tariff reduction applies to "most of the tariff range, subject to the exceptions that already exist in the bloc." Under Mercosur rules, each member country can choose up to a previously agreed-upon limit of products to which joint tariff rules do not apply.
“The understanding reached considers the different needs of member countries, demonstrating Mercosur’s capacity to move towards updating and adapting its tariff structure to current regional and world trade conditions, in a balanced manner in terms of the bloc’s productive capacities,” the Ministry of Economy reported. The measure applies to about 80 percent of the scope of the levy and brings its rates in Brazil and other bloc members closer to the international average.
“This is an important step to increase the competitiveness of the countries in the bloc and to strengthen regional production processes, in order to foster the integration of Mercosur's production onto global value chains,” the ministry declared.
Also during the 60th ordinary meeting, the Mercosur Council announced the conclusion of talks on a free-trade agreement between Mercosur and Singapore.
In addition to Argentina, Brazil, Paraguay, and Uruguay, the South American bloc also includes Venezuela, even though the country has been suspended since 2007. Bolivia, Chile, Colombia, Ecuador, Guyana, Peru, and Suriname are considered associated states.
