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Brazil and Argentina defend the continuity of the TEC

Mar 21, 2023 Brazil

Both the Brazilian Footwear Industries Association (Abicalçados) and the Footwear Industry Chamber from Argentina (CIC) stressed the importance of the External Tariff of Mercosur (TEC) for the sustainability of the sector

In a meeting held on the last 7^th of March between representatives of Abicalçados and CIC to discuss the sector's bilateral trade, the support for the maintenance of the External Tariff of Mercosur (TEC) took centre stage. “The end of the TEC, currently set at 35% for footwear imported from countries outside the Mercosur, would open the way for a Chinese invasion on Brazilian and Argentine shelves”, warned Haroldo Ferreira, the Executive President of Abicalçados, highlighting that it is not a matter of protectionism but of commercial defence.

The easing of the COVID-19 restrictions in China at the end of 2022 has been raising concerns among footwear manufacturers. According to Abicalçados, last year almost 50 million US dollars in Chinese footwear entered Brazil, up by 34.6% over 2021; Argentina, instead, registered the entrance of footwear from China worth 88.7 million US dollars, up by 438%, year-over-year.

“The indiscriminate entrance of Asian footwear would cause a breakdown in the sector, generating a wave of unemployment. We cannot compete in equal terms with a country that practices dumping - export prices below the domestic market prices - and doesn't respect labour and sustainability legislations”, added the Executive President of Abicalçados.

At the meeting, the associations also spoke of the possible establishment of a single currency for Mercosur, currently being discussed by the governments of the two countries, the normalization of payment flows of imports to Argentina and the growing importance of sustainability in the production chain of footwear.

Source and Image Credits: abicalcados.com.br

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