The Brazilian government has made official the suspension of a controversial barrier to imports that directly affected the sales of Argentine products. The move to suspend the barrier, however, was largely due to the strong complaints lodged by the member countries of Mercosur. The barrier seemed simple but powerful, as well as discordant to what Mercosur wants to achieve as a trade association.
There simply was a requirement to obtain prior authorization to import into Brazil. The rule required exporters to seek permission, using a special form, to be able to send their goods to the country. In turn, the Brazilian government had a term of up to 60 days to allow the entry of goods. This made the process hugely bureaucratic and led to significant delays in the shipments of goods to Brazil.
Brazil explained that the measure was meant to monitor the details of imports, in order to be compliant with policies drawn in the light of the global crisis. The restrictions were a response to Brazil’s January deficit in trade balance amounting to 645 million dollars, a situation that has not happened since 2000. The measure had been described as “protectionist” by some foreign chambers of commerce and industry.
Of course, Brazil was being protectionist. On one hand, it has every right to protect itself against the slings and pangs of outrageous fortune in this time of global economic meltdown. On the other, the country’s insular attitude can be construed as unbecoming of a member of a regional trade association. With the suspension of the import barrier, what is indispensable to Brazil at this point becomes clear. At the same time, the situation has taught Brazil an important lesson, that of the fact that it has to swim along with the others if it were to survive the rough seas.
Via INO.com
