Brazilian President Lula da Silva announced yesterday the ratification of the free trade agreement between the Mercosur South American trade bloc and Palestine, allowing the entry of Palestinian products without customs tariffs. According to Lula, Brazil is the first country in the bloc to ratify a free trade agreement with Palestine. He made the announcement at the 64th Summit of Mercosur heads of state in Paraguay.
This came after the Union of South American Nations (UNASUR) included Palestine in the common market that promotes free trade between Argentina, Brazil, Uruguay and Paraguay, which together make up 76 per cent of the gross domestic product (GDP) of Latin America. “The agreement is a concrete contribution to an economically viable Palestinian state, which can live peacefully and harmoniously with its neighbours,” said the Ministry of Foreign Affairs.
According to local Brazilian reports, the ratification comes after Lula’s description of the Israeli aggression against the Palestinians in Gaza as “genocide”.
The Palestinian Authority asked in April for the ratification of the Mercosur-Palestine Free Trade Agreement that was signed on 20 December, 2011. The agreement will come into force for Brazil and Palestine thirty days after ratification.
The agreement provides for “duty-free access to EU markets for Palestinian industrial goods, and a phase-out of tariffs on EU exports to Palestine over five years.” It also “reinforces the regulatory framework aimed at expanding trade between Mercosur and Middle Eastern countries. Moreover, it covers trade in goods; rules of origin; bilateral safeguards; technical regulations, assessment and compliance standards and procedures; sanitary and phytosanitary measures; technological cooperation; institutional arrangements and dispute resolution.
Ever since its creation in 1991, Mercosur’s main objective has been to promote a common space that generates business and knowledge through the competitive integration of national economies into the international market. As a result, it has established multiple agreements with countries or groups of countries. Furthermore, it seeks to develop a South American forum for addressing political, social, economic, environmental and infrastructure issues that will reinforce the identity of South America.
Israel signed a framework agreement with Mercosur in 2007. The occupation state was the first country outside South America to sign a free trade agreement with the bloc, which gave tangible advantages to Israeli companies.
“For Israel, of course, nothing much happens by coincidence,” Brazil’s former Minister of Foreign Affairs, Celso Amorim, told MEMO earlier. “Israel is aware of South America’s importance to its own national interests. The agreement with Mercosur included trade valued at around $1.1 billion at that time. All Israeli industrial and agricultural products sold to Mercosur countries were exempt from customs duties.”
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