Puerto Iguazu, Argentina, 6 Jul (Xinhua) -- Firmly Advocate Fair Trade The MERCOSUR countries have called for reducing their dependence on the US dollar
Xinhua News Agency reporter Wang Zhongyi
The sixty-second summit of the Common Market of the South (MERCOSUR) recently concluded in Puerto Iguazu, northern Argentina. In order to reduce dependence on the US dollar, the leaders of MERCOSUR member states such as Brazil, Argentina, Paraguay and Uruguay called for the use of local currencies between member countries.
This is the Argentine Ministry of Economy photographed on June 30 in Buenos Aires, the capital of Argentina. Argentina's central bank issued an announcement on June 29 announcing the inclusion of renminbi in the currencies allowed to be deposited and withdrawn in the country's banking system, and authorizing the country's financial institutions to open renminbi savings accounts. Xinhua News Agency (Photo by Martin Sabara)
Analysts pointed out that with the continuous advancement of world multipolarization, Latin American countries, including Mercosur member states, are increasingly reluctant to be swayed by the hegemony of the West, especially the United States. It has become the consensus of countries in the region to further unite countries in the region, promote regional economic integration, and seek a fairer trade and more independent development path.
The FTA negotiation is an important topic of this meeting, and the call of the MERCOSUR countries to unilaterally impose conditions on the MERCOSUR-EU FTA has attracted widespread attention.
After the conclusion of the free trade agreement between MERCOSUR and the EU in 2019, the text of the free trade agreement entered the final stage of review. In March, the EU imposed conditions requiring MERCOSUR countries to export products to the EU to meet EU environmental requirements or face sanctions.
Brazilian President Lula promised to complete the MERCOSUR-EU FTA negotiations during Brazil's presidency in the second half of this year, but he explicitly opposed the EU's unilateral increase in conditions for the FTA, saying that "partners will not negotiate on the basis of mistrust and threats of sanctions, and MERCOSUR must respond quickly and forcefully."
Visitors watch BYD's pure electric vehicles in Salvador, the capital of the Brazilian state of Bahia, on July 4. Photo by Xinhua News Agency reporter Wang Tiancong
Argentine President Fernandez said that MERCOSUR countries should promote industrial upgrading and strive to further integrate with the world market as exporters of industrial products rather than raw materials.
Patricio Giusto, a professor at the Catholic University of Argentina, believes that the EU's unilateral imposition of conditions on the Mercosur-EU FTA reflects the EU's protectionist approach. The environmental issues raised by the EU are just a cover to protect the interests of agricultural producers and energy mining companies within the EU, and agricultural and energy mining is one of the Mercosur countries' strengths and is related to environmental issues.
In addition to the FTA negotiations, reducing the impact of US dollar fluctuations on Latin American countries, promoting the integration process at the regional level, and achieving coordinated regional development have also become the focus of attention of all parties.
For a long time, the development of Latin American countries has been subject to the hegemony of the US dollar. In recent years, the Fed's extreme monetary policy has led to high inflation and high debt in Latin American countries, and imported financial risks have increased significantly.
In 2008, Brazil and Argentina used their local currencies for import and export trade, and no longer used the US dollar as an intermediary currency. At the MERCOSUR Summit, the participants agreed to carry out studies to further promote the settlement of trade in local currencies among MERCOSUR countries.
Paraguayan Minister of Finance Oscar Liamosas believes that the use of local currency settlement will contribute to the economic stability of MERCOSUR member states and promote the development of trade between MERCOSUR countries.
Argentine Minister of Economy Massa said that MERCOSUR countries have an important position in the global food and energy mining fields, and strengthening economic integration will help MERCOSUR countries play a more important role in the future international economic pattern.
In January, the leaders of Brazil and Argentina said they were studying launching a common currency for South America. The initiative to create a common currency in South America shows the willingness of major Latin American economies to seek to promote regional economic and trade development and integration, promote regional integration, and reduce dependence on the US dollar.
Argentine President Fernández (right) and Brazilian President Lula attend a press conference at the Rose Palace in Buenos Aires, Argentina, January 23. Fernandez and Lula said on the same day that the two sides are willing to work together to deepen bilateral relations and promote regional integration. Xinhua News Agency (Photo by Martin Sabara)
Lula pointed out at the MERCOSUR Summit that the use of a common currency for settlement of trade transactions between MERCOSUR countries will help reduce transaction costs and promote regional integration.
Giusto believes that there are still challenges in achieving local currency settlement for trade between MERCOSUR countries, and even in the future, using the South American common currency, but this summit has fully demonstrated MERCOSUR's determination to strengthen regional integration and reduce dependence on the US dollar.