MANUFACTURING/PRODUCTION

• Adoption of a "Protocol for Harmonization of Intellectual Property Rights, Trademarks and Origins". This protocol will include in the future additional regulations on other aspects such as design and copyright.

• Definition of a transition period for a standardization of rules.

• International jurisdiction in matters of consumer relations. It gives the consumer in any of the Mercosur countries the right to sue for compensation, regardless of the purchase origin.

• Definition of a transition period until 2001 for the standardization of rules which apply to products origination in third countries. The Treaty of Asunci�n forbids the use of safeguards by its parties.

• Five sections of the Consumer Protection Code were approved. An institutional framework is to be devised or its implementation.

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• Institutional Agreements EU/Mercosur signed in Santiago in May 1992 (establishing regular co-operation between the two groups).

• The ‘Solemn Joint Declaration’, signed in Brussels in December 1994 by the European Council and Mercosur member states, by which the parties agree to sign an Economic and Commercial Co-operation Inter regional Framework Agreement by the end of 1995.

• Economic and Trade Co-operation Agreement between Mercosur and European Union, signed on 15 December 1995.

• USA proposal for a Hemispheric Free Trade Area based on two approaches: the Initiative for the Americas (IFA) and the NAFTA. In the IFA context, a free trade area ranging from Alaska to Patagonia was proposed. As a preliminary, the USA signed ‘Framework Agreements’ with Mercosur, Caricom and other Latin American and Caribbean countries.

• The Rose garden Agreement (or 4 + 1 Agreement) was signed with the Governments of the countries of Mercosur on the 19^th of June 1991, setting up a forum for consultation on trade and investments.

• In December 1994, in Miami, at a Summit meeting (Summit of the Americas) with all Latin American Heads of State (with the exception of Cuba) USA and Canada, negotiations started aiming at a free trade agreement by the year 2005.

• There have been no formal agreements between Mercosur and NAFTA. Brazil welcomes the idea of gradual integration between countries or groups of countries, so that the integration process may evolve towards the creation of a large free trade area.

• Discussions about NAFTA have assumed greater relevance as a result of the conclusion of the Uruguay Round, the invitation to Chile to join, and the movement toward an FTAA after the Miami Summit.

• The Treaty of Asunci�n is convergent with both Hemispheric and South American integration, but it is an independent project in its scope and purpose. Unlike NAFTA, Mercosur is a Customs Union with a common external tarrif.

• In 1994, Brazil proposed setting up a ‘web’ of free trade agreements with neighboring South American countries. Negotiations have been carried out, jointly, by all Mercosur members to establish FTAs with the other South American countries or sub-regional groups of countries in ten years.

• In 1996, free trade agreements with Chile and with Bolivia were signed.

• In 1997, other free trade agreements between Mercosur and the remaining Andean Pact member countries (Venezuela, Colombia, Peru and Ecuador) are expected to be signed.

• Mercosur has also started to develop closer co-operation and exploratory contacts with ASEAN/APEC, with SADC, India, Japan, CIR (Russia), CER (New Zealand and Australia).

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• In December 1995, at a meeting held in Montevideo, the Mercosur countries set out a program of action with guidelines for future negotiations and specified goals for the year 2000. Regional integration must deepen through full implementation and the perfecting of the Customs Union in the context of open regionalism.

• Before the year 2000, the Mercosur countries will reflect on the need for new institutions, as a consequence of the evolution of Customs Union as a process towards the achievement of the Common Market.

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MERCOSUR and Its Origins

The Common Market of the South (MERCOSUR) is an ambitious economic integration project in which Argentina, Brazil, Paraguay and Uruguay find themselves engaged. Its principal objectives are: to improve the economies of their countries by making them more efficient and competitive and by enlarging their markets and accelerating their economic development by means of a more efficient use of available resources; to preserve the environment; to improve communications; to coordinate macroeconomic policies; and to harmonize the different sectors of the economies of the member countries.

Mercosur is currently the fourth largest economic bloc in the world with more than US$750 billion GNP and over 220 million inhabitants. This is more than 58 percent of the entire Latin American GNP, and over half of the region's population. Since1994, Brazil, Argentina, Paraguay and Uruguay have been united in Mercosur, and Chile and Bolivia recently became associated members.

A "four plus one" free trade agreement, between the MERCOSUR countries and Chile, became effective October 1, 1996. A free trade agreement between MERCOSUR and Bolivia entered into force April 1, 1997. MERCOSUR is negotiating association arrangements with other Andean countries and Mexico. MERCOSUR members also are participating as one body in the process leading toward a Free

Trade Area of the Americas.

Eighty percent of the major companies in Latin America are settled in Mercosur. The principal trade and investment partner is by far the European Union, with which Mercosur has a 'bilateral' trade agreement. An older agreement with the United States called '4+1' never really prospered. In addition to WTO regulations, however, these agreements have become an important framework for the Mercosur 'club' to better service the needs and requirements of Northern powers and their elites.

Administrative Structure

Intraregional Trade and Investment

Trade between the four member countries has grown sharply. In the period 1990-1994, the value of intraregional trade nearly tripled, from US$4.1 billion to US$10.7 billion. This growth partly reflects the progress made under the Trade Liberalization Program, as well as the gradual elimination of non-tariff restraints to reciprocal trade and an increase in trade and production initiatives among entrepreneurs in the region.

In 1994, intraregional exports increased for the fifth consecutive year, to nearly one-fifth of the combined value of exports of the four countries, well up from a level of under 9 per cent in 1990. This performance confirms the trend in recent years in which MERCOSUR has consolidated its position as the principal trading partner of Paraguay and Uruguay and the principal market for Argentine exports. The sustained increase in intraregional exports is attributable to the fact that between 1990 and 1993 sales of manufactured products soared at an average annual clip of 43 per cent, to an estimated US$6.2 billion by 1993, or more than 60 per cent of trade within MERCOSUR.

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Sources: The Portable Encyclopedia for Doing Business with Argentina
Economic Report from Uruguayan Embassy___ http://embasy.org/uruguay/econ/mercosur/
Mercopress Online
Friends of the Earth-Uruguay
Interamerican Development Bank