Cristina Índio do Brasil
Reporter - Agência Brasil

Rio - Of the twelve South American countries, only Colombia and Chile have been increasing their investments in infrastructure in recent years, according to a study by the Inter-American Development Bank (IADB). Due to the lack of a regional policy for this sector, the investments are not only insufficient but fail to produce a real interaction among the countries, in the opinion of Maurício Mesquita Moreira, an economist with the IADB's Department of Integration and Regional Programs.

Yesterday (6), Moreira called for the integration of all transportation routes in South America, without which the creation of a unified market, especially the Mercosur, is hampered.

The economist's research compares import duties with transportation costs among the countries of the region. He said that freight costs exceed import duties in nearly all of them. "When one looks at capital goods, import duties are still superior to freight costs, but with the exception of these items, the gist is that more is to be gained by reducing transportation costs than by deepening trade agreements. This agenda has to be more balanced. Let's deepen the agreements, but let's also restore the infrastructure, because without this there is no unified market," he argued.

The economist also underscored the need for greater integration, improvement, and consolidation of the common market. Moreira added that this agenda encompasses non-tariff barriers, reform of the Common External Tariff (CET), investments in infrastructure, and consolidation of macroeconomic coordination.

Moreira's work for the IADB analyzed the situation of the South American countries and found that the members of the Mercosur concentrated on the elaboration of trade agreements and neglected the development of infrastructure projects, which he considers the chief obstacle at present to the growth of the bloc. He acknowledges that privatization attracted private investment in some sectors, but, in the transportation area, it failed to compensate the drop in government investments.

Moreira's assertions are based on "The Treatment of Asymmetries in the Regional Integration Agreements," a study presented at the first panel of the International Conference, "The Deepening of the Mercosur and the Challenge of Inequalities," organized by the IADB. The study, which was prepared by economists in the IADB's Department of Integration and Regional Programs, observes that the sustainability of the Mercosur's integration project depends upon its capacity to inspire confidence through reliable and predictable rules that favor long-term investments.

The closing session of the Conference will be presided today by the executive director of the IADB for Brazil, Rogério Studart.

Translation: David Silberstein