Gov’t may negotiate after WTO ruling

17/01/2015 12:00 - 516 Views

Following the World Trade Organization’s (WTO) rejection of Argentina’s bid to overturn a ruling in favour of the United States, the European Union (EU) and Japan, Cabinet Chief Jorge Capitanich has said that the government will seek to “establish bilateral negotiation criteria” with the complainants, and that for the moment the country’s import rules are still in force.

On Thursday, the WTO rejected Argentina’s bid to overturn a ruling in favour of the US, the EU and Japan in a case against national licensing rules that the international body said have been used to unlawfully restrict imports.

The World Trade Organization (WTO) ruling against Argentina triggers “no immediate modification” of the country’s trade administration, Cabinet Chief Jorge Capitanich pointed out adding a “comprehensive and detailed analysis of the ruling’s terms” is needed.

Capitanich added that an analysis of the economic repercussions was still required, considering the financial crisis is still hitting hard on the global economy. Furthermore, the cabinet chief blasted “media operations” that report an “alleged lack of certain goods and supplies,” something he blamed “companies’ lack of planning or speculative actions” for. Shortage of certain goods or supplies, he affirmed, is not a matter of restriction or import authorizations.

President Cristina Fernández de Kirchner’s policy of controlling imports to shield local industries and bolster trade surplus could be affected severely by the ruling, but its implementation will not be immediate, with delays over implementation periods, negotiations between the countries and disputes over the reach of the decision likely to occur.

Even though the Domestic Trade Secretariat had been previously restricting some imports through resolutions and informal agreements with importers, the conflict with trading partners escalated in 2012 when Argentina imposed a system requiring prior approval of nearly every purchase from abroad, sparking the WTO case.

The DJAI import permits were at the heart of the US, EU and Japan’s cases, and the WTO also saw them as central in its ruling, although other control mechanisms were also mentioned. Japan had also complained about lengthy delays in authorizing DJAI permits before imports could go through, in similar fashion to local importers, who have sparked public clashes with government officials lately.

As a result, the government agreed this week to create an online system that would allow importers to automatize the approval of these permits, looking to ease the process, which today deals with 8,000 permits per day. Changes in the nature of the system could also be used by the government to argue that sanctions should not apply.

Source: Buenos Aires Herald