The Spanish market is the main destination of Argentinean shrimp exports. (Photo: Stock File/FIS)

Argentinean hake and shrimp may lose tariff preferences

EUROPEAN UNION
Monday, April 23, 2012, 02:20 (GMT + 9)

With absolute majority -- 458 votes in favour, 71 against and 16 abstentions -- the full European Parliament (EP) approved the partial cancellation of the tariff preferences the European Union (EU) grants to several Argentinean products, such as shrimp (prawns) and frozen hake fillets.

This action was taken in response to the Argentinean government's decision to expropriate the oil company YPF, a subsidiary of the Spanish company Repsol.

According to 2010 data, about 27 per cent of total Argentinean exports to the EU market (equivalent to EUR 2,400 million) receives the benefit from this type of commercial advantage.

In the resolution of the European Parliament the position announced by the president of Argentina, Cristina Fernández de Kirchner, is “deplored.”

With the exception of Green groups/the European Free Alliance and the United Left, the other MEPs have urged the European Commission (EC) and the EU Council to consider and adopt, in defense of European interests, whatever measures are necessary to prevent the recurrence of situations like the present one."

MEPs also request the inclusion of a "possible partial cancellation" of Argentina in the generalized system of preferences (GSP).

The resolution rejects the decision of Argentina because the authorities have not "considered a negotiated settlement when they intended to proceed with the expropriation of most of the actions of a European company, as it represents a unilateral and arbitrary decision."

MEPs also consider that the nationalization of YPF is an "attack on the exercise of free enterprise and the principle of legal certainty, thereby deteriorating the business environment for EU businesses in that country," reported EFE.

In another part, the EP’s document stresses that the action as that taken by the Argentinean government can "strain the cordial and empathic relationships that are necessary" to carry out the ongoing negotiations of an Association Agreement between the EU and Mercosur.

"For these negotiations to be successful, both parties have to hold discussions showing openness and mutual trust," they add.

In 2010 Argentina exported fish, crustaceans, molluscs and other aquatic invertebrates (especially shrimp and frozen hake) to the EU market for EUR 535 million. Within the block, the Spanish market remains the main destination of Argentinean exports.

The European Commissioner for Trade, Karel De Gucht, sent a letter to the national government for them to become aware of the fact that the EU is concerned about the president’s decision regarding the oil firm.

By Analia Murias
editorial@fis.com
www.fis.com

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