Trending

Newsletter

Argentina and Brazil Renew Auto Trade Agreement, Adjust Flex Rules

By: PanAm Post Staff - Jun 15, 2014, 7:57 pm

EspañolOn Wednesday in Buenos Aires, Argentina and Brazil agreed to a one-year extension of an important auto trade agreement benefiting the Argentinean industry, whose government is trying to maintain a positive trade balance amid an economic slowdown.

The agreement reduces the number of tax-free cars and auto parts that Brazil is able to export to Argentina. A press release explained that for every US$1 Argentina exports to Brazil in automotive goods, it will import US$1.50 from that country, down from US$1.95.

“The important issue is the volume of trade, and the flex rate agreed to benefits the flow of goods between both countries,” the Brazilian Minister of Industry Mauro Borges told reporters. Brazil said that the extension of the automotive agreement under the new conditions was also beneficial to its economy because it would increase volume in the bilateral exchange.

Argentinean Minister of Economic Affairs Axel Kicillof said that the agreement seeks to avoid a trade imbalance resulting from aggressive commercial strategies by automotive companies on both sides of the border.

Source: Reuters.