Brazil will not renew bilateral maritime transport agreement with Argentina

The Brazilian Embassy in Buenos Aires has advised the Undersecretariat of the Ministry of Foreign Affairs of Mercosur that the country will terminate the Maritime Transport Agreement between the two republics as of February 9, 2022. The notification of the decision is within the term provided for in the agreement.

The treaty dates from 1985 and continued the agreements of the 1959 Maritime Conference of Argentine and Brazilian Shipowners. On February 5, Leonardo Cabrera,  the Undersecretary of Ports, Waterways, and Merchant Marine of Argentina, called together the Argentine Chamber of Navigation and other bodies to inform them of the definitive and unappealable decision adopted in Brasilia to proceed with the adoption of the business measures they deem convenient.

According to INFOBAE, the vehicle consulted one of the main figures in the national naval sector who stated: “Argentina did not pay much attention to the Mercosur Maritime Agreement issue, delaying negotiations for decades and mediating the management by several governments from different political parties. “Uruguay’s position in safeguarding the interests of the Port of Montevideo contributed to Argentina’s laziness in promoting a regional agreement that went beyond a binational agreement,” he added. Now, unfortunately, the Argentine Merchant Navy is reduced to minimum participation, perhaps the worst in its entire history, that condemns it exclusively to national freight between national ports – and I would even dare to say that it will be like this for a long time”.

Other sources in the sector indicated that as the country prepares to start a bidding process for the waterway dredging concession, the loss of the freight market with Brazil will undoubtedly generate discouragement in the business sector.

On the Argentine side, the main companies affected would be Arpez, Agunsa, Fluvialmar, Horamar, Maruba, Naviera Sur Petrolera, Oceanmarine, and Petrotank. Under the agreement, these companies transport cargo, from fishery products to fuels, including general dry, liquid, and refrigerated cargo from different sources.

Annual bilateral maritime trade is valued at around US$ 20 billion, with profits that fluctuate around US$ 700 million in the direction of import or export. The value of services related to sea freight is around US$ 1 billion, to which is added the values ​​for supply, fuel, ship repair, and agency services.

The graph below shows container movement between Brazil and Argentina since 2017:

Container Handling between Brazil and Argentina | Jan 2017 – Dec 2020 | TEU

Graph source: DataLiner (To request a DataLiner demo click here)

Report source: INFOBAE

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