Free trade agreements have never been a part of Argentina’s government’s mentality. Argentina has long been known for its inward-looking corporate environment, which is governed by a series of protectionist laws and regulations. President Mauricio Macri, on the other hand, has worked to open Argentina’s doors to international trade since 2015.
Macri has been engaged in pursuing greater integration through free trade agreements to achieve this. His political narrative has been ‘opening Argentina to global trade’ since his inauguration. With this mandate, Macri has been successful in opening up a variety of economic opportunities, allowing for more exports of Argentinian produce and, as a result, boosting bilateral relations.
Argentina has long been a member of regional trade organizations and global trade blocs, although its participation has been more passive than active. Macri has been attempting to undo the legacy of the Peronist government’s mentality.
Free trade in Argentina: World Trade Organization
The World Trade Organization is one of these trade blocs (WTO). Argentina has been a member of the World Trade Organization (WTO) since January 1995. Argentina has taken a back seat in its activities despite being a long-term and well-integrated member. However, Macri was successful in bringing the WTO ministerial meeting to Argentina for the first time in 2017. By embracing the world’s largest trade association, Macri scored a major political victory, signaling to the rest of the globe that Argentina is open for business and eager to welcome international investors.
Argentina – Chile bilateral free trade agreement
Presidents Piera of Chile and Macri of Argentina met in March 2019 to commemorate the ratification of Protocol 61, a new trade agreement between the two countries.
Despite sharing one of Latin America’s longest land borders, Argentina and Chile have historically struggled to reach an agreement on commerce. Protocol 61 is the most comprehensive commercial agreement signed between the two countries to date. It covers a wide range of topics, including commerce in products, services, and investments, as well as tariffs and legal requirements.
The pact goes on to lay out the two countries’ labor rules and even develops a joint environmental strategy. It also includes the deregulation of a slew of economic activities, most notably e-commerce, which will make goods in both countries far more accessible. The chapter on the capacity of enterprises from both countries to bid on each other’s public contract tenders is perhaps the most important part of the agreement. Allowing Chilean companies to work on government contracts is a significant step forward for Argentina in particular.
Both countries are benefiting six months after the pact was ratified. The majority of commerce is currently taking place in the food industry, with Argentinian farmers benefiting from higher prices for their products across the border as a result of their recent economic condition.
MERCOSUR – India trade agreement
The India-MERCOSUR preferential trade agreement is another major trade pact with the Latin American trade bloc. The agreement, which went into force in June 2009, was designed to provide reciprocal fixed tariff preferences. After six rounds of negotiations, the two sides agreed on a list of 450 products for reciprocal tariff reductions.
Rubber and tires, plastics, medicines, spices, and machinery were among the things imported from India. Tariffs on meats, raw hides and skins, leather, wool, cotton, and iron were cut as a result of the MERCOSUR.
Argentina benefits notably from this in the areas of meat, rawhides, and leather, and is known for its beef output.
MERCOSUR – European Union
Apart from Brazil, the EU accounts for the majority of Argentina’s exports at the moment (13.4 percent ). On June 28, 2019, the two trade blocs finally reached an agreement after nearly two decades of talks. Mauricio Macri, president of MERCOSUR, and Jean-Claude Juncker, head of the European Commission, signed the agreement. “The MERCOSUR agreement with the EU is the most important in our history,” Macri said after ratifying the accord. The agreement brings together 780 million people and eliminates billions of dollars in tariffs, making it one of the most significant trade deals ever.
The most notable change in the agreement was the modification in agricultural import and export restrictions, which drew criticism from European farmers but provided opportunities for Latin American producers. Because taxes on Latin American products, such as wine and meat, have been decreased, Argentinian farmers now have access to a new market. Another example of Argentina’s industries moving in the correct direction toward increased global integration may be found here.
