Argentina suspended a trade
complaint against the European Union over Spanish biofuel curbs
after Spain dropped its plan.
The Spanish government issued a law in April last year
requiring that only EU fuel could meet quotas for biofuels used
in transport. That prompted a World Trade Organization challenge
by Argentina, the world’s largest exporter of soybean biodiesel,
which said the plan was discriminatory and a violation of WTO
rules. Spain said on Oct. 16 that it would abandon the order
incorporating the EU’s renewable energy law into national
legislation.
“We decided not to proceed with the case,” Enrique
Ferrer, a diplomat in Argentina’s mission in Geneva, said in a
telephone interview today. “Spain’s government issued a new
decree, so for the time being we are able to export biodiesel to
Spain. We are still following it very closely to see if our
exports don’t have any problems in the market and then we won’t
proceed with the case.”
The EU said its order was designed to protect the
environment by increasing the use of renewable energy and to
contribute to the security of the energy supply. Argentina’s
Foreign Ministry said the real intention was retaliation after
President Cristina Fernandez de Kirchner’s government seized a
51 percent YPF SA stake from Spain’s Repsol SA (REP) in April.
Spanish Industry Minister Jose Manuel Soria said on April
16, the same day YPF was nationalized, that his government would
take “decisive” action against Argentina within days. The
seizure of YPF could not be challenged under WTO rules.
Spanish Retreat
Marking a retreat from Soria’s threat to retaliate with
“clear and decisive” measures on trade, industry and energy,
Deputy Prime Minister Soraya Saenz de Santamaria said on April
20 that Spain would undermine demand for Argentine biodiesel by
offering incentives to use Spanish and EU biodiesel.
Fernandez and Spanish Prime Minister Mariano Rajoy are both
due to attend a summit of the EU and the Community of Latin
American and Caribbean States starting in Santiago tomorrow.
Relations between Argentina and its major trading partners
have soured under Fernandez’s presidency and led to the Latin
American country’s growing political and economic isolation.
Along with the EU, the U.S. and Japan have complained separately
at the WTO about Argentina’s import policies, saying they hinder
foreign goods and discriminate between imported and domestic
products.
“The measure in question foresees a procedure for
allocation of biodiesels quantities among producers, and only
biodiesels from producers with an assigned quantity would count
towards meeting compulsory targets on the use of biofuels,”
John Clancy, a European Commission spokesman, said in an e-
mailed reply to questions. “Additionally, in December, Spain
amended certain aspects of the ministerial order subject of the
complaint.”
The 27-nation EU is Argentina’s second-biggest trading
partner after Brazil. Argentina’s $448 billion economy is South
America’s largest, after Brazil.
To contact the reporter on this story:
Jennifer M. Freedman in Geneva at
jfreedman@bloomberg.net
To contact the editor responsible for this story:
James Hertling at jhertling@bloomberg.net