Randy McDonald (rfmcdpei ) wrote,

[LINK] "Bolivia Takes the Leap into the Big Pond of Mercosur"

Inter Press Service's Mario Osava writes</u> about Bolivia's interest in joining Mercosur, the South American trade bloc co-founded by Argentina, Brazil, Uruguay, and the recently-suspended Paraguay and recently expanded to include Argentina. Politically, Mercosur seems suited for Bolivia; economically, Bolivia has a large trading deficit with its potential trading partners if natural gas is excluded. Moreover, the future of the bloc as a meaningful entity seems open to question, between Paraguay's suspension and perennial disunity in trade talks with the European Union.

“Before Bolivia has even entered Mercosur, the bloc has already entered Bolivia, and it is doing so to a growing extent,” through bilateral trade agreements, observed Gary Rodríguez, general manager of the Bolivian Institute of Foreign Trade (IBCE).

When natural gas, which represents 96 percent of Bolivia’s exports to Mercosur, is added to the equation, the balance is reversed, leaving Bolivia with a 1.692-billion-dollar trade surplus.

But gas exports are based on operations and agreements between national governments and do not involve the private sector, stressed Rodríguez in an interview with IPS at the IBCE headquarters in Santa Cruz, where he shares the same concerns and the same office tower with powerful business owners in the eastern Bolivian department (province) of the same name.

His greatest concern is for the future of Bolivian private companies. Last year, for example, 30 million dollars worth of shoes were imported from Brazil. In conditions like these, “we won’t be able to continue manufacturing ourselves,” said Rodríguez, who fears that the Bolivian market will be flooded with these and other goods in the event of a devaluation of the Argentine peso and Brazilian real against the dollar.

But Mercosur membership, the path chosen by the government of leftist President Evo Morales, could open up new prospects for Bolivian business owners “especially those involved in big agribusiness in eastern Bolivia,” Tullo Vigévani, a professor at Paulista State University in Brazil, told IPS.
Tags: bolivia, brazil, economics, latin america, links, politics, regionalism, south america
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