Publication

This paper analyzes the impacts of trade and exchange rate misalignments on trade barriers and trade relations between the EU and Mercosur. The first section summarizes the debate on exchange rates at the WTO; the second explains the methodology used to determine exchange rate misalignments; the third and fourth summarize the methodology; the fifth reviews the effects of exchange rate misalignments on tariffs and its consequences for the trade negotiations between the two areas; and the last concludes and suggests a way to move the debate forward in the context of regional arrangements.