RIO DE JANEIRO, Oct. 3 (Xinhua) -- Brazil and Argentina signed on Thursday a free trade agreement for the automotive sector in Montevideo, Uruguay.
The deal, which was agreed upon last month, foresees free trade of vehicles starting from July 1, 2029. Brazil and Argentina will gradually phase out trade tariffs for each other in the automotive sector.
Unlike previous agreements, this one is not valid for only a fixed period, which brings legal security to the Brazilian automotive industry, as well as certainty of investments in the sector, said the Brazilian Foreign Ministry.
According to the Brazilian government, Brazil's exports to Argentina in the automotive sector amounted to 7.5 billion U.S. dollars in 2018, representing half of the trade between the two countries.
The new agreement also lowered the minimum share of locally-made parts to 50 percent, from the previous 60 percent.