Argentina came under a barrage of criticism at the WTO on Friday, where the US, the EU, Japan and 10 other countries accused it of tying up imports in red tape.
Argentina’s center-left government has imposed a raft of sometimes unorthodox import restrictions in recent years as it battles to shield local industry and its trade surplus, which shrank 11 percent last year to US$10.4 billion.
On Feb. 1, Argentine President Cristina Fernandez’s administration imposed a new system to pre-approve, or reject, nearly every purchase from abroad.
“It appears that this new system is operating as a de facto import-restricting scheme on all products,” US Ambassador to the WTO Michael Punke said, according to a transcript provided to reporters by one of the participants.
The critics described the policy as “unbefitting any WTO member” and “particularly troubling” because they limit the growth--enhancing prospects for trade.
They demanded Argentina take immediate steps to reverse its policies or risk further action at the WTO.
Argentina has also been pushing importers to match their purchases abroad with exports, leading to quirky deals such as one whereby carmaker BMW exports rice.
Friday’s joint statement at the WTO said government officials were apparently using arm--twisting tactics to enforce the agreements — a frequent complaint of local businesses in Latin America’s No. 3 economy.
“Many companies have reported receiving telephone calls from Argentine government officials in which they are informed that they must agree to undertake such trade balancing commitments prior to receiving authorization to import goods,” Punke said in the joint statement.
According to the agenda of the meeting, the statement was backed by Taiwan, Australia, Canada, Costa Rica, Israel, Japan, South Korea, New Zealand, Norway, Panama, Switzerland, Thailand and Turkey, as well as the EU and the US.
Punke said the Argentine Industry Ministry’s Web site was replete with press releases about such trade balancing arrangements, including automakers exporting wine, olive oil and soy meal.
“Argentina may claim that companies enter into these arrangements voluntarily, but many of the members supporting this statement share concerns that it may be operating otherwise,” he said.
Guillermo Moreno, Argentina’s domestic commerce secretary and the top enforcer of the government’s interventionist policies in recent years, has been given a key role in monitoring the import restrictions.
He is known in the South American country for putting heavy pressure on companies to keep prices in check and threatening economists who put inflation at more than double the official rate with fines and even jail time.
Argentina’s foreign ministry said in a statement that it ratifies the country’s trade policies, which the government says are needed to keep Argentines employed.