Tag Archives: Mercosur

Brazil extends limits on auto imports from Mexico

AutoThree years ago, we sobbed in this space when Brazil slapped quotas on imports of Mexican automobiles in an effort to boost the local industry.  At the time, BRIC-star Brazil was beginning to feel economic headwinds and Mexico’s auto industry was picking up steam. The 2012 quotas were supposed to be lifted after a three-year period, but with our customary foresight we predicted this would not come to pass. Well, the three years are up and last month Brazil and Mexico announced that they had agreed to extend the quotas on Mexican auto imports for another four years. We really just amaze ourselves sometimes. Continue reading Brazil extends limits on auto imports from Mexico

Brazil weasels on auto trade with Mexico

Setting trade policy?
Setting trade policy?

In March 2012, Brazil insisted on putting artificial curbs on imports of Mexican-made automobiles, contrary to the long-standing pact governing vehicle trade between Mexico and the Mercosur trade bloc comprised of Brazil, Argentina, Paraguay and Uruguay.  We’re in a snit about this, because the move creates problems for Mexico and in general adds to the list of alarming actions coming out of Mercosur countries lately that are undermining the environment for trade and investment.

The Economic Complementation Agreement No. 55, known as ACE 55, was negotiated between Mexico and Mercosur in 2002 as a means of reducing tariffs on vehicles and auto parts to facilitate trade in these goods between the five countries.  It worked; automotive trade surged and the deal seemed to suit Brazil just fine as the South American giant racked up a trade surplus in cars with Mexico year after year. Continue reading Brazil weasels on auto trade with Mexico