Limited resources hold back Mercosur FTA

ALAN PEAT DESPITE PRESS reports that the free trade agreement (FTA) with the South American Mercosur grouping of countries is getting closer to finality, it is not likely to be an overnight settlement, according to Riaan de Lange of customs and trade advisers, PricewaterhouseCooper. “I can’t see them concluding this deal in the next year or two,” he said, “or even longer.” An indicator of the time-span which it takes to finalise such FTAs is the eight years taken to conclude the SA FTA with the European Union (EU). “The Mercosur deal was only started in 2000, and even then it was originally kicked off with a memo of understanding being signed only by the presidents of SA and Brazil,” said De Lange. “It was only after this that it was decided that the regions - Mercosur representing Brazil, Argentine, Chile, Paraguay and Uruguay, and the Southern African Customs Union (Sacu) for SA, Botswana, Lesotho, Namibia and Swaziland - should be included in the free trade thinking.” A delaying factor is likely to be the issue of human resources dedicated to free trade agreements in southern Africa, De Lange added. “We have a team that negotiates the FTAs,” he said. “One group deals with all the agreements, but in South America, they have one team for each individual agreement.” Given this issue of resources, extra strain is likely to be cast on the SA team - with the FTA with the US (also started in 2000) likely to be given priority.