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Argentina: Fears that Trump won't admit lemon imports to US

The shares of the San Miguel company, the largest exporter of lemons in the country, plunged by 8.21 percent last week and the cumulative decline in the last two days has been 11.7 percent. The company from Tucuman was expecting that the administration of Barack Obama would soon authorize the entry of Argentine lemons to the US market after 15 years. Mauricio Macri's government had been negotiating this possibility in recent months and it seemed everything was ready for this to happen. However, the surprise victory of Donald Trump now raises questions about what may come, as the US president-elect had an overtly protectionist speech during the election campaign.

The strategy for lemons is to try to accelerate the market opening so that it is a reality before Trump is sworn on January 20, but no one knows if Obama will go ahead with this plan or if he'll leave the decision to his successor. The governor of Tucuman, Juan Manzur, will travel on Friday 27 to New York and Washington to try to speed up the procedures. "There are state policies that are core policies and have to do with the country's development in the medium and long term. I don't think the outcome of the election will impact or interfere with the opening of the American market for Tucuman; I don't think we'll have any problems," the governor said after learning about Trump's victory over Hillary Clinton. "The opening of the market depends on protocols, technical and trade issues that have been overcome, not necessarily on political and electoral aspects," the Minister of Productive Development, Juan Luis Fernandez, added. His words, however, could be more wishful thinking than a certainty. In fact, in April, Manzur estimated that the resolution approving the reopening of trade with the US starting next year would be achieved within 60 days; something that still has not happened.

Argentina is the leading producer of lemon in the world and Tucuman is the biggest producer in the country with 1.3 million tons per year. Exports to the US were discontinued in 2001 after a producer lobby from California stated that the Argentine citrus were not safe in phytosanitary terms and, following a court ruling, imports from the South American country were banned. To refute the possibility that Argentine lemons could transmit a bacterium, in recent years the country made a series of presentations in various international organizations, such as the World Trade Organization (WTO). They even sent a scientific report that demonstrates that Argentine lemon can't be a host of Citrus Variegated Chlorosis (CVC), the bacteria denounced by California producers, to the US health authorities. The issue was also analyzed during the visit of Barack Obama to Argentina and he promised to green light the Argentine lemons, which the government of Macri presented as a triumph. Now, that possibility might be at risk.

Some analysts have also begun to doubt that the US would allow the entry of Argentinean meat into their market, even though the World Trade Organization ruled in September last year that the US had to raise barriers to Argentine exports of meat.

Macri's government had also recently stated that the United States would include Argentina in a tariff preference system, which would allow Argentina to export a list of products to the US without paying fees. The Minister of Production, Francisco Cabrera, said this agreement would be ready before the end of the year, when reporters asked him if this agreement would be reached. Argentina was taken out of this system in 2012 when two US companies, Azurix and Blue Ridge, denounced the Argentine government for nonpayment of arbitration rulings in the World Bank tribunal, ICSID. The official intention was to present their incorporation into this system as proof that the relationships with the US had entered a new stage after Macri won the elections. However, the arrival of Trump has forced the government to shuffle and deal its cards again, as the mogul constantly stated that his objective was to defend the American workers against increasing imports.

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