Minister meets agriculture to smooth Mercosur trade deal

Economic Affairs Minister Johann Schneider-Ammann wants to speed up a free trade agreement between Switzerland and the Latin American countries of Mercosur, but there is concern in the agricultural sector. “A free trade agreement without the agricultural sector is not thinkable,” Schneider-Ammann told a press conference on Tuesday. He was speaking after a meeting with some thirty business and agricultural organizations to discuss the aspects relating to agriculture. The Swiss Farmers’ Unionexternal link (USP) declined to attend.

A trade agreement with Mercosur, which includes Argentina, Brazil, Paraguay and Uruguay, should give Swiss exporters access to this market of 260 million consumers, but the agricultural sector will have to accept some changes. The government took this into account when it last November unveiled sensitive plans for agricultural reform, including more competition and less protectionism.

This strategy is opposed by the USP, which says the plan contains no measures to mitigate the “huge losses that farming families will suffer”. It also says that the Mercosur negotiations and agricultural reform plan are separate issues which should not be linked. Representatives of the 27 organisations that took part in the meeting, including associations of milk, meat and cereals producers, agreed that protectionism is not an option, according to Schneider-Ammann. He said the effects of an agreement on agriculture would be limited, although he did not give a figure.

Switzerland wants an agreement with Mercosur quickly, because the European Union is close to an agreement with those countries and if it reaches a deal before Switzerland, Swiss exporters would suffer. Despite the size of the market, Switzerland currently exports only CHF4 billion ($4.28 billion) to Mercosur countries. The free trade agreement would affect not only agriculture but export companies which currently face considerable tariffs in those countries.

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