Breaking its hesitations, the government of Uruguay has agreed to support proposals to raise the duty imposed by the member states of Mercosur on imports of certain types of shoes and some other sensitive products from 20 to 35 percent. It was the only country still resisting the move.

Besides Uruguay, the member states of Mercosur are Argentina, Brazil and Paraguay. Foreign affairs ministers of the four countries still have to meet to formalize the measure. Mercosur had lowered its duties on certain types of shoes from 35 to 20 percent four years ago, but as indicated in our issue #14 of July 20, this had the effect of pushing up imports of the other types of footwear. All the categories will be covered if the new duties go into effect.

The Brazilian government has invited the European Union to sign a bilateral trade agreement for 0 percent duties on shoes, but it has not met a positive response from authorities in Brussels.

Argentina already has quotas on shoe imports. The new duties would provide much-wanted relief for the Brazilian shoe industry, which is suffering from the appreciation of their currency, the real. In spite of that, Brazil’s shoe export statistics show an unusual increase to $182 million for the month of August, compared with the usual level of $145-150 million for that month. For the seven months ended in July, Brazil’s exports were up by 2 percent in value to $1,118 million, but down in volume by 2 percent to 103.9 million pairs.

Meanwhile officials from China and Argentina met last week to try to resolve a trade dispute that stemmed from Argentina’s imposition of new tariffs on various types of leather imports from Asia, with China singled out as a particular worry. The talks were prompted after China threatened to complain to the World Trade Organization.

For their part, Chile and Ecuador have signed a pact that will have the two countries combine their knowledge of leather production and sales, including technical developments, environmental issues, protection of intellectual property and industry-related data. The two countries will also seek to relax their bilateral customs restrictions on leather trade.