RIO DE JANEIRO, BRAZIL – Economy Minister Guedes said the Brazilian government is looking to “modernize” the economic bloc, but has met resistance from Argentina.
“Our position is to move forward. We will not leave MERCOSUR. But we will not accept MERCOSUR as an ideological tool. MERCOSUR has a very clear proposal: it is a platform of integration into the global economy. If it doesn’t deliver this, we will modernize it, and anyone uncomfortable with this can leave,” he said while taking part in the “O Brasil quer Mais” (Brazil wants more) online event, promoted by the International Chamber of Commerce.
Brazil has been suggesting a 10% cut in the common external tariff (TEC) for all products, while Argentina argues that only some goods should be included in the reduction. “We will stand firm on this position. Argentina seems to be very fixed on a position that is in opposition to ours,” said Guedes about the internal disputes in the bloc.
There are also differences of opinion on the form of decision making within the bloc. Currently, all decisions are made based on consensus among the 4 member countries.
“Unanimity is required to make changes in MERCOSUR and they turn this into vetoes. In fact, there are 3 countries looking to modernize MERCOSUR: Brazil, Paraguay and Uruguay. Argentina is in a very special moment, very delicate, and we understand that,” the Minister said on the issue.
PRIVATIZATIONS
On Brazilian economic policy, Guedes again advocated privatizations of state-owned companies as one of the guiding principles of long-term planning. “To proceed with privatizations: Petrobras, Banco do Brasil. All in line, being sold, and this being turned into social dividends,” he said.
The Minister also stressed that privatizations totaling R$240 (US$44.5) billion have been completed in the past 2 and a half years. Guedes expects the sales of large state-owned companies such as Eletrobras and Correios to be passed in the coming months.
“The plan is to change the Brazilian state: to rely more on private investment, to expedite privatizations,” he added.