Venezuela Joins MERCOSUR
On 4 th July 2006, President Hugo Chavez convened a mini summit in Caracas with the MERCOSUR Presidents ( Argentina , Brazil , Paraguay and Uruguay ) and President of Bolivia, Evo Morales, as a special invitee.
2. At a well attended and nationally televised function, the four MERCOSUR leaders and President Chavez signed the Protocol of Accession admitting Venezuela as a full member of MERCOSUR, a regional trade grouping formed in 1991 with the objective of commercial and economic integration. MERCOSUR operates on the basis of a common external tariff. Trade in almost all commodities is free within the bloc.
3. In 1999, MERCOSUR countries accounted for 5.6% of Venezuela 's imports. By 2005, this figure had gone up to 13.1%. Apart from increasing trade contacts, there are several economic projects conceived between Venezuela and other MERCOSUR countries, particularly in the energy sector, the main project being the mega-gas pipeline from the Venezuelan coast to Argentina, a distance of over 8000 kms, at a cost of over US$20 billion, which will carry Venezuelan gas in future to Brazil, Argentina, Uruguay and Paraguay, with the possibility of being linked with Bolivia for supply of gas from that country as well.
4. MERCOSUR accession for Venezuela has the following time table:-
• 180 day period during which working groups will finance details of harmonization of tariffs, nomenclature, list of sensitive items etc.
• Brazil and Argentina to provide access to Venezuelan imports under the TEC (External Common Tariff) of MERCOSUR by 1 st January, 2010.
• Venezuela to provide the same benefits under TEC to all four current MERCOSUR members by 1 st January 2012, except sensitive items for which deadline is 1 st January 2014.
• Paraguay and Uruguay to provide similar access to Venezuela by 1 st January 2013.
5. With Venezuela joining MERCOSUR, the regional organization now has a combined population of 250 million, a combined GDP of US$ 1 trillion, and total exports of US$ 300 billion, as of the year 2006. The bloc also has a colossal geographic reach from the Caribbean Sea in the north to the Antarctic in the south, and comprises huge deposits of fresh water and natural resources: amongst the worlds largest deposits of oil and natural gas; significant deposits of iron ore, gold, bauxite, precious gems and other minerals; and a powerful agriculture and cattle rearing base.
6. Venezuela had formally conveyed to the Secretariat of the Andean Community (CAN) its decision to withdraw from that regional grouping on 22 nd April 2006. On 22 nd May 2006, Venezuela had also conveyed formally its decision, effective after 180 days to withdraw from the G-3, grouping it with Colombia and Mexico in a similar agreement.
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