U.S. Challenges Argentina’s Use of Trade Restrictions
August 31, 2012
The United States and Japan criticized Argentina’s import rules as protectionist at the World Trade Organization (WTO), putting more pressure on the country to revamp policies that many trading partners say violate global norms.
The two complaints mirrored litigation brought by the European Union (EU) in May. Mexico filed a similar dispute against Argentina this week.
“Argentina’s protectionist measures adversely affect a broad segment of U.S. industry, which exports billions of dollars in goods each year to Argentina. These exports support jobs and businesses here at home,” U.S. Trade Representative Ron Kirk said in an emailed statement.
“The Obama Administration insists that all of our trading partners play by the rules and uphold their WTO obligations so that American workers receive the benefits negotiated in our agreements,” the Kirk statement added.
Argentina began requiring prior state approval for nearly all purchases abroad in February. Imports have since fallen compared with last year’s levels. EU and U.S. officials say Argentina has effectively restricted all imports since the new system came into place.
WTO members have the right to ask importers to apply for an import license, but they are supposed to grant them automatically. In Argentina, however, many licenses labeled “automatic” suffer long delays, according to the European Commission.
Argentina has also been criticized for a policy of trade balancing, which forces an importer to guarantee an equal value of exports.
Argentina now has 60 days to satisfy Japan and the United States that its policies comply with WTO rules or face a possible escalation of the dispute. Afterward, the complainants can ask the WTO to adjudicate, which could end in Argentina being forced to repeal any laws found to contravene WTO rules.
The EU has not said whether it will ask the WTO to set up an adjudication panel on its dispute with Argentina.
Defending the country’s policies against criticism at the WTO, Argentina has asserted it cannot be accused of restricting imports when its imports grew by 31 percent in 2011.