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Venezuela is to be excluded from Mercosur

The four other member states of the Mercosur trading bloc, Argentina, Brazil, Paraguay and Uruguay, have excluded Venezuela from “South America's Common Market”. The stated reasons are fundamental infringements of the constitutional and democratic principles, compliance with which is a requirement for membership.
A street in Venezuela.
Venezuela is no longer in the Mercosur alliance.

Conditions from the accession protocol not fulfilled

An official communication from the government of Paraguay datedDecember 2, 2016, indicates that Venezuela has been excluded from the trading bloc. As a result, Venezuela is now only an associate member, which is only allowed to take part in certain meetings at the invitation of the member states. As early as last summer, Venezuela was set a deadline of December 1, 2016, to comply with the entrance requirements. The Mercosur states accuse the country of not fulfilling fundamental principles of democracy and the rule of law, and of exhibiting deficits in the adoption of the Mercosur rules in matters of trade.

The Mercosur states base their decision on Article 60 of the Vienna Convention on the Law of Treaties. Venezuela has sharply criticized the decision and characterized it as unlawful.

Impact on trade still unclear

Venezuela is primarily an importer in the Mercosur alliance, which means that any restriction to the preferential tariff arrangements could above all affect the remaining member states. But for the relationships with the EU and EFTA, the decision could mean that free-trade negotiations will be taken up again with greater vigor.

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