Switzerland is close to concluding a free trade agreement with the four Mercosur countries – Argentina, Brazil, Uruguay and Paraguay – within the framework of the European Free Trade Association (EFTA), Swiss Economics Minister Johann Schneider-Ammann told reporters in Bern following his South America visit.
Schneider-Ammann has just returned from a seven-day visit to the four South American countries, accompanied by 50-strong delegation of Swiss business leaders and politicians, aimed at convincing both sides of the benefits of a common trade agreement.
The trip comes only three months after EFTA (Switzerland, Norway, Iceland and Liechtenstein) and Mercosur representatives signed a joint declaration in Bern, understood by Schneider-Ammann as “the launching of negotiations between both blocs”. Meanwhile, the European Union is poised to finalise a free trade accord with Mercosur.
Schneider-Ammann told Swiss public radio (RTS) on Tuesday that he believes Switzerland is well placed to conclude a Mercosur deal: “What’s important is that we are very close behind [the EU]. If we manage to secure an EFTA-Switzerland deal six months after the EU that would balance things out.”
Supporters of a trade agreement with Mercosur say it should give Swiss exporters access to a market of 260 million consumers, but the Swiss agricultural sector has concerns. While an agreement should make exports easier for Swiss machine and services industries, South American countries will be able to increase their meat sales in Switzerland in exchange.
The Swiss Farmers’ Union is against a deal. Swiss farmers expect pressure on prices of beef, chicken, oil seeds and sugar owing to more imports from South America.
The Swiss authorities claim an agreement would reduce customs duties and save up to CHF206 million ($205 million) annually. Exports to Mercosur countries are currently taxed at rates ranging from 7 to 35%.