The new automobile agreement signed by Brazil and Argentina, to become valid in July, will make the two countries jointly become the world's fourth biggest automobile producer, said Brazil's Ministry of Development, Industry and Foreign Trade on Tuesday.
With the deal inked last week, by the year 2013 when both countries start free trade in the auto sector, their joint annual auto production is expected to reach 6 million automobiles, 5 million in Brazil and one million in Argentina.
Together, they will be among the world's top auto producers, after Japan, China and the United States.
One of the main clauses of the agreement, the third signed by Brazil and Argentina since 2000, is the creation of a maximum quota of imports, which was designed to favor Argentina.
Up to the present, the export of every 100 U.S. dollars of goods to the other country allows the partner to import up to 195 dollars without having to pay a tax of 35 percent of the prices of the imported products.
Under the new agreement, Brazil will keep that quota while Argentina will increase it to 250 U.S. dollars, which is expected to stimulate investments in the country.
Source: Xinhua
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