Brazil and Argentina have updated on Friday the terms of an existing free trade deal for the automotive sector, an Argentinian government news agency said.
The deal was signed in the Brazilian capital, Brasilia. Under the terms of updated deal, the two countries should reach a full free trade agreement for their automotive sectors by 2029.
The Argentinian government news agency said the updated terms are in line with Mercosur’s recent agreement with the European Union. Mercosur is comprised of Brazil, Argentina, Uruguay and Paraguay. The former free trade automotive deal was expected to take full effect in 2020. However, the new agreement sets a ten-year period for it to take full effect. It also sets “partial” goals.
The previous agreement had set a limit, in which Brazil could export $1.5 in vehicle value for every $1 it imported from Argentina, and vice-versa. Under the new agreement, such an export/import limit is now expected to increase from $1.5/$1 to $3/$1.