June 29, 2006
Venezuela becomes Mercosur's full member

(Bancoex Press Office, reproduced by Ven Global News) - "By signing the Adhesion Protocol, Venezuela starts to participate actively in Mercosur's negotiations and in the decision making process. This will make it possible to continue boosting the integration process.

Regarding Venezuela's full incorporation into Mercosur, the Venezuelan Minister for Integration and Foreign Trade and President of the Foreign Trade Bank (Bancoex, Spanish acronym), Gustavo Márquez Marín, informed that Venezuela's Adhesion Protocol to Mercosur reaffirms the important role our country will play by joining this union; that is to say, to promote the strengthening of South America's integration towards the construction of the South American Union (Unasur, Spanish acronym) as Mercosur is the strongest core in the Latin American and Caribbean integration process.

He explained that this protocol acknowledges the integration process based on the ALBA principles (interdependence, solidarity, cooperation) as instruments to fight poverty and social exclusion. He also added that the Bolivarian Republic of Venezuela enters Mercosur based on the principles of gradualism, flexibility, balance - according to the Montevideo Treaty of Integration Latin American Association (Aladi) - and the acknowledgement of asymmetries as the foundations of a distinguishing treatment among member countries.

'This acknowledgement is the foundation of negotiations for setting up a free trade area, the adoption of an external common tariff, the adhesion to international agreements endorsed that are in force or that are being negotiated by Mercosur with third countries or group of countries, and the conditions regulating the participation of the Bolivarian Republic of Venezuela in Mercosur' in order to strengthen the common market that currently represents 8%, explained the minister.

According to Gustavo Márquez Marín, the protocol takes into account the principle of food sovereignty (food security, sustenance and integrated rural development) for Venezuela's incorporation into Mercosur. This principle is acknowledged in the progressive integration process contained in Mercosur's regulations.

He pointed out that the adoption of an External Common Tariff (AEC, Spanish acronym) in four years (since the Adhesion Protocol comes into effect) will make possible to establish exceptions; that is to say, the exclusion of products from the AEC so that the Member States could carry out public policies aimed at endogenous development.

In this sense, he said that the differences between national tariffs and the Mercosur's AEC are understandable because each member country has the right to establish exceptions; Venezuela will use this right in order to make easier the design and the execution of active policies regarding endogenous development and food sovereignty.

'According to the Adhesion Protocol, the deadline to adopt the free trade area is 7 years, 5 years for non-sensitive products and 7 for sensitive products; this shows that the Venezuelan sensitive products are receiving a special treatment. Likewise, Uruguay and Paraguay are granted a total tax deduction (100%), as soon as Venezuela's Adhesion Protocol comes into force, on a list of exportation products that are important to these countries,' said Gustavo Márquez.

He informed that Venezuela will also be granted a total tax deduction by Brazil and Argentina in 2009, while Paraguay and Uruguay will do the same in 2013. On the other hand, Venezuela will grant Brazil and Argentina the same deduction in 7 years (5 years for sensitive products and 7 years for non-sensitive products); thus acknowledging the existing asymmetries and the distinguishing treatment among Brazil, Argentina and Venezuela.

Also, Venezuela will grant this deduction to Uruguay and Paraguay , as soon as the Adhesion Protocol comes into effect, on a list of exportation products that are important for these two countries. At the same time, Uruguay and Paraguay will grant Venezuela this deduction in 6 years regarding the rest of the non-deducted products.

On the other hand, Minister Márquez Marín said the Origin Regime (RO) is important to guarantee that Mercosur's imports really come from its member countries. These imports carry a particular value added tax percentage in order to prevent community commerce from getting damaged through third countries' products. 'The protocol provides for the Origin Regime to be the same Venezuela currently follows regarding ACE 59 until it adopts Mersosur's. This should happen in 7 years, time that will make possible to adapt our Origin Regime to Mercosur's.

Márquez Marín highlighted that the regulations contained in the Economic Interdependence Agreement Number 59 (such as safeguard, health and special measures, complementary aspects and provisional orders) will not change until January 1, 2014.

He emphasized that Venezuela will join the Mercosur's Delegation in the negotiations with third countries or groups of countries (article 8) and will be able to know first hand as a member country each agreement negotiated by Mercosur, as well as participate in negotiations from the very moment it endorses the protocol; when this protocol comes into force, Venezuela will be able to participate and make decisions on negotiations.

'According to the Adhesion Protocol, adopting this regulation will make possible to develop a wide joint social agenda aimed at meeting the most urgent social needs by developing joint initiatives in order to achieve the millennium goals, and to boost the fight against poverty and social exclusion. Likewise, it also acknowledges the need of favoring a social content in Mercosur, which is the foundation for developing a new integration model based on interdependence, solidarity, and cooperation principles, as well as the respect for the sovereignty of States and Peoples; that is to say, the ALBAS principles,' said Márquez Marín.

By signing the Adhesion Protocol, Venezuela starts to participate actively in Mercosur's negotiations and in the decision making process. This will make it possible to continue boosting the integration process.

Finally, Minister Marín explained that - according to Mercosur's article 10 - Venezuela can become a Mercosur's full member and take on all its rights and duties as soon as the protocol comes into force".