Chavez calls for joint Mercosur stand

The president of Venezuela has urged the South American trade bloc Mercosur to act as a common front against US free trade deals.

    Mercosur's combined GDP will soar to $1 trillion

    Hugo Chavez marked his country's formal entry into the organisation by holding a summit in Caracas on Tuesday attended by the leaders of Brazil, Argentina, Uruguay and Paraguay, the other Mercosur members, as well as Evo Morales, the president of Bolivia and a close ally of Chavez, who attended the ceremony as an observer.

    "We are defeating the hegemonic pretensions" of the United States "and today we have placed a new cornerstone for the freedom and unity of South America," Chavez told a crowded auditorium.

    Brazilian President Inacio Lula da Silva called on fellow Mercosur members to maintain political solidarity in the face of challenges from countries outside the region, but said that anti-Americanism was not a characteristic of the regional trade bloc.

    "Today we are here to say to the world that we don't want to fight with anybody," he said. "We are peaceful countries."

    Swelling coffers

    Venezuela is the one of the world's leading oil producers and its entry into Mercosur will increase the economic power of the trading bloc by taking its combined GDP to $1 trillion, which is more than three-quarters of South America's total economic activity.

    "Economically stronger countries have to understand the realities ... of smaller countries"

    Tabare Vazquez, president of Uruguay

    Under the entry agreement, Venezuela will have to adopt a common external tariff system within four years. The level of those tariffs will vary depending on the product but will average about 12%, said Eduardo Sigal, Argentina's undersecretary for economic integration.

    Venezuela and the continent's two largest economies - Brazil and Argentina - will establish free trade zones by 2012. Paraguay and Uruguay will immediately benefit from preferential tariffs for their principal exports to Venezuela before gradually establishing free trade zones by 2013.

    Not all agreed with Chavez that the outlook for Mercosur was so rosy.

    Minor complaints

    The president of Paraguay, Nicanor Duarte, raised concerns about alleged protectionist practices by Brazil and Argentina that have prompted Paraguay and Uruguay to question the benefits of Mercosur membership.

    Duarte said the bloc's system of common tariffs "does not always agree with commercial practices that still pose many obstacles, especially for less developed countries like Paraguay."

    Paraguay has complained that its products face long delays in entering Mercosur's two biggest markets and has also protested rules that prohibit it from signing bilateral trade deals with countries outside the bloc.

    The Uruguayan president, Tabare Vazquez, agreed, calling for "a bigger and better Mercosur."

    "Economically stronger countries have to understand the realities ... of smaller countries," he said. "In the process of integration, small nations count too."

    SOURCE: Agencies


    Interactive: How does your country vote at the UN?

    Interactive: How does your country vote at the UN?

    We visualised 1.2 million votes at the UN since 1946. What do you think are the biggest issues facing the world today?

    'We were forced out by the government soldiers'

    'We were forced out by the government soldiers'

    We dialled more than 35,000 random phone numbers to paint an accurate picture of displacement across South Sudan.

    Interactive: Plundering Cambodia's forests

    Interactive: Plundering Cambodia's forests

    Meet the man on a mission to take down Cambodia's timber tycoons and expose a rampant illegal cross-border trade.