Argentina under fire for protectionism

Aug. 23, 2012 at 10:33 AM
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BUENOS AIRES, Aug. 23 (UPI) -- Argentina is under fire for increasing protectionist barriers and fighting criticism with countercharges against nations that complain about the trade policies of President Cristina Fernandez de Kirchner.

Fernandez received a tongue-lashing from Spanish newspaper ABC for hoping to fight "a thousand" battles single-handed and for taking on the world in a "particular crusade."

Fernandez hasn't responded to mounting criticism and her aides earned opprobrium from the United States and Japan after launching counterclaims of trade discrimination.

In fact, U.S. officials said, Argentina has been piling up protectionist barriers that run counter to World Trade Organization rules.

Argentine officials privately admitted to media members that Fernandez could be running against the tide but open opposition to her policies from senior aides appeared unlikely.

Both the United States and Japan have cited Argentine trade practices as protectionist. Their WTO complaints followed EU action in May that led to an indefinite adjournment of any meaningful talks on a free trade accord encompassing Europe and Latin America's Mercosur pact.

The latest row centers on U.S. rules restricting imports of Argentine lemons and beef.

"The United States is surprised and disappointed at Argentina's reaction," U.S. Trade Representative spokeswoman Nkenge Harmon said in a statement.

"It appears to be part of a disturbing trend in which countries engaged in actions that are inconsistent with their WTO obligations retaliate with counter complaints rather than fix the underlying problem raised in the complaint," she added.

Harmon defended the curbs, saying "all U.S. measures relating to imports of Argentine products, including lemons and beef, are science-based and consistent with WTO requirements."

Argentine officials say they see no justification for U.S. restrictions based on health concerns while the produce is accepted in other countries.

"Argentine citrus is exported to destinations with very high health standards such as the Netherlands, Spain and Italy, which do not question the excellent quality of Argentine produce," an Argentine government statement said.

It said U.S. restrictions on Argentine beef because of foot-and-mouth disease were also unjustified.

"Although the International Health Organization has recognized the southern Patagonia region as free of foot-and-mouth disease, without vaccinations, since 2003, the U.S. government has delayed recognition of this situation, and has unreasonably delayed the authorization for the importation of fresh beef," the Argentine government said.

It said Argentine ranchers had lost hundreds of millions of dollars as a result of the U.S. curbs.

Argentina has struggled to find sympathy for its case in the WTO because of documented instances of frequent rule violations. Critics, including U.S. officials, say Argentina needs to do more to restore international confidence since its 2002 sovereign debt default.

Earlier this year, Argentina began requiring prior state approval for nearly all purchases abroad.

WTO members say the Argentine measures violate free trade rules.

Argentina has lodged a complaint against Spain for restricting its biofuels but continues to defend its seizure of Spanish-controlled Argentine energy company YPF in May.

More than 20 WTO members have criticized Argentina's import rules and seizure of YPF from Spain's Repsol.

One of the unpopular rules requires Argentine importers to balance imports with equal value of exports, even if they have to access other sectors. Argentine machine part importers have been found to be struggling to export grains and other commodities of equal value, often wasting effort and resources in unfamiliar fields.

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