Brazil Likely to Approve India-Mercosur International Trade Deal

Brazil is expected to formally approve the proposed PTA (preferential trading agreement) between India and Mercosur in the next few months. According to Brazilian Foreign Minister Celso Amorim, the ratification of the proposed international trade deal was facing a procedural delay. But he stated that the PTA was likely to be approved before or after the visit of President Luiz Inacio Lula da Silva to India in June. The proposed preferential trade agreement is expected to boost international trade between India and the members of the Mercosur.

It must be noted that the proposed international trade agreement has already been ratified by India and the other members of Mercosur except Brazil. The Brazilian foreign minister also vowed to back the efforts of India to protect the agricultural industries of developing countries and the livelihood of small-scale farmers in the on-going Doha Development Round. Mr. Amorim said that he would support the case of special products, which would be excluded from tariff cut commitments. With its booming economy, India, along with Brazil, represents the interests of the developing countries in the international trade talks under the World Trade Organization (WTO).

Two weeks ago, Mr. Amorim attended the ministerial-level meeting that was held by the members of the G6 (the United States, the European Union, Brazil, India, Japan, and Australia). The conference has been aimed at breaking the deadlock in the Doha Round. It must be noted that the negotiations have made a slow progress since they were launched in 2001. Last July 2006, the talks were suspended due to the failure of the WTO members to resolve international trade issues concerning market access and farm subsidies. Although the Doha Round formally resumed in Geneva last January, the WTO has not yet made a significant progress in the talks. Needless to say, the members of the G6 are optimistic about the success of the negotiations.

Meanwhile, Mr. Amorim said that his country would back the demand of India for special products in the Doha Development Round. The Brazilian foreign minister made this comment during a seminar organized by the Confederation of Indian Industry (CII). When he was asked about the delay of the PTA's approval, Mr. Amorim said that there was no problem as regards the content of the international trade deal. According to him, his country was taking a long time in approving the PTA due to procedural delays. The proposed PTA is expected to boost international trade between India and the Mercosur members. Mercosur comprises Paraguay, Venezuela, Uruguay, Argentina, and Brazil.

US-South Korea International Trade Talks Threatened by Looming Deadline

The US had warned that its on-going free trade agreement (FTA) talks with South Korea were "not going well." The two countries have been racing against time in order to reach an international trade deal. It is very important for the two parties to complete their international trade negotiations before the trade promotion authority of President George W. Bush ends in July this year. The proposed FTA has been aimed at boosting bilateral trade between the US and South Korea by up to $20 billion.

Although the US and South Korea had completed several rounds of FTA talks, the two countries still need to iron out certain issues in order to reach an international trade agreement. It is significant for the two sides to conclude their negotiations before the expiration of Mr. Bush's TPA. This would spare the proposed FTA from being changed by the US Congress during the approval process. It must be noted that Mr. Bush and his South Korean counterpart Roh Moo-hyun talked about the proposed FTA through phone on Thursday last week. During the conversation, the two leaders vowed their commitment to the FTA talks.

Yoon Seung-yong, who is the spokesman of South Korea's president, stated that the two leaders agreed to intensify their efforts in order to reach an international trade deal. According to him, both Mr. Bush and Mr. Moo-hyun exchanged ideas regarding remaining issues affecting the progress of the FTA negotiations. Differences over the textile, agriculture, and automobile sectors are among the key issues that must be resolved by the two parties. After negotiating during the last ten months, the US and South Korea were only able to reach a consensus on three areas out of the 17 sectors included in the proposed FTA.

Although Deputy US Trade Representative Karan Bhatia and South Korea Trade Minister Kim Hyun-chong tried to settle the differences between their countries, they have not been able to make a significant breakthrough in the key issues mentioned above. If the proposed international trade pact materialized, it would be the biggest free trade agreement to be signed by the US since the NAFTA (North American Free Trade Agreement) in 1993. The FTA is expected to boost trade between the two countries. While it would strengthen the presence of the US in Asia, it would enable South Korea to gain a greater access into US markets. The proposed international trade pact is expected to boost the US-South Korea trade by up to 420 billion.