WTO World Trade Organisation
The European Union is planning to lodge a complaint at the World Trade Organization over Argentina's new import restrictions and is seeking other trading partners to back its suit.
The Argentinian import restrictions, implemented in February this year, require licenses for all imported goods, which make it more expensive for other countries to export to Argentina.
The EU may seek additional action in response to the country's recent nationalization of its largest oil firm YPF.
According to one of the officials of EU, this is a process that is advancing but it will take some time before it becomes official.
They have also said that by taking this action, Argentina has sent shock waves through the international business community. Further, they said that the consequences for its own economic development shall be felt for a long time to come. But this is not only about Argentina. Europe also has a stake in this matter as it is one of our own companies that is under attack.
In fact, it is likely to be "a matter of weeks" before the EU launches the case.
The issue has already prompted a war of words between Argentina and at least fourteen of its trading partners at the WTO, and relations with the EU have been inflamed further by Argentina's decision to seize control of YPF.
The United States, Japan, South Korea, Australia and other countries have all said they are unhappy about restrictions imposed by Argentina.
However, U.S. Ambassador to the WTO led the criticism at a March 30, 2012 meeting of the WTO's Goods Council, where he said Argentina had put a blanket restriction on trade by requiring import licenses on all imported goods from Feb 1 of this year.
To this, Argentina's Secretary for International Economic Relations said that the restrictions were necessary to account for market "distortions" created by developed nations in the wake of the 2008 financial crisis.
Further, an honest assessment of the multilateral trading system shows that it is not the licenses imposed by Argentina and by so many other countries, but the traditional distorting measures applied mainly in the developed countries which are the root cause of the real problems in international trade.
EU trade spokesman, however, declined to comment on the likelihood of an EU-backed suit against Argentina on 24th April.