Brazil could retaliate against Argentina for new rules restricting food imports, with the European Union also protesting the latest shift to protectionism in South America's second-biggest economy.
The unwritten rules aimed at limiting imports of foods that Argentina already produces have come into play in recent days, industry sources say, affecting mainly Brazil and the EU.
"The Brazilian ambassador is holding various meetings to try to avoid this," Brazilian Trade and Industry Minister Miguel Jorge told Folha de S. Paulo newspaper late on Wednesday.
"We have an important flow of food products both to and from there," Jorge said, adding that Brazil had received no official notice of new restrictions.
The import curbs would be "incompatible with World Trade Organization norms and Argentina's commitments in the G20," the local EU delegation said in a statement.
But Argentine Economy Minister Amado Boudou said the measures are "a policy that we've been developing since 2009, we need to see how we can preserve the trade balance and jobs in Argentina."
Argentina's March trade surplus shrank by 77 percent from a year earlier, which the government attributed in part to a strike by port workers that slowed grain shipments abroad.
Boudou said the restrictions aimed "to preserve the quality of life among Argentines," adding that "Europe has farm subsidies, and the countries that champion free trade also have restrictions."
Argentina is already embroiled in a trade row over protectionism with China.
China imposed new import standards on soyoil from Argentina, the world's largest exporter, early last month in apparent retaliation for Argentine anti-dumping restrictions on Chinese shoes, steel and other products.
The countries have since made little progress in resolving the dispute.
"The latest clampdown on food imports is baffling," wrote Boris Segura of RBS Securities in a note to clients on Thursday.
"International trade is a two-way street, and Argentina would actually have more to lose from entering into a trade war, as it is a heavy net food exporter," he wrote.
The country's food-and-drink sector exports $12 billion of processed products, and imports about $900 million, according to the National Administration of Drugs, Food and Medical Technology (ANMAT).
"All that the market demands in imported food products will be available in the country's supermarket aisles," Industry Minister Debora Giorgi said at an event in the central province of Cordoba.
"Argentina works under the rules of the World Trade Organization and we will continue to do so," she said.
An ANMAT spokesperson said the agency will compile daily a list of products that need import approval for review by the commerce secretary, who is known as the government's consumer price watchdog.
ReutersLast Mod: 13 Mayıs 2010, 23:59