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Greece threatens Argentina with its canned peaches

Greece threatens Argentina with its canned peaches

ATHENS: After a few years in which the ghost of unfair competition seemed to have receded, Greece has, once again, threatened Argentina with its canned peach and a fashionable maneuver: commercial triangulation, in this case via Paraguay, where it pays less import duty.

Thus, it enters Argentina’s informal circuit US$4 cheaper and with an advantage in the Brazilian market, which is the main destination of the national product. The Greek product exploits a gap among the Mercosur partners, which apply the 35% AEC (Common External Tariff) for extra-zone products since 2010. However, Paraguay applies a differential 14% tax to a list of 100 products, which includes packaged fruit from Greece. According to a distribution map, the Paraguayans consume a part of the volume. The rest ends up being marketed in the north of Argentina, Bolivia, and Brazil. The triangulation allows the irregular entry of merchandise. At first, Paraguay didn’t adhere to the new tariff because it had been suspended as a member of Mercosur. However, there are no longer any excuses for this. This is the result of the strong lobby of importers and supermarkets in a country where there is more informality,” said the president of Cafim (Chamber of Fruit Industrialized of Mendoza), Raul Giordano. According to the agroindustrial sector this has two damaging effects. “It has a direct effect as there will be an unfair price competition in the Argentine market, and, additionally, it will affect us indirectly in Brazil, because it will make it harder for us to position our products there,” the business leader stated.