After two decades of arduous talks, the European Union (EU) and Mercosur reached a political agreement in 2019 to seal a historic trade agreement, of which technical aspects remained pending. However, the ambitious pact has failed to materialize due to new demands from both sides, especially demands on environmental issues from the EU. Mercosur will hold its semiannual summit on December 6 and 7, an event in which the bloc hoped to announce the positive conclusion of the negotiations, but, according to the Governments of Brazil and Argentina, the matter will be postponed.
The leaders of the Mercosur member states – Argentina, Brazil, Paraguay and Uruguay – will meet on December 6 and 7 in Rio de Janeiro, where they will discuss the current state of the regional economy, the bloc’s trade routes with foreign countries and the possible accession of Bolivia as a full member of the group. However, the main course of the meeting will be the discussion on the much-delayed technical signing of the trade agreement with the European Union.
The conversations will aim at future negotiations; it will be complex to achieve the materialization of the free trade agreement with the European Union before that Mercosur meeting in the first week of December.
In fact, on the eve of the meeting, the two most powerful economies in the bloc – Argentina and Brazil – have warned that the negotiation will not prosper in the coming days.
“If there is no agreement, be patient. It was not due to lack of will,” said Brazilian President Luiz Inácio Lula da Silva, at a press conference during the United Nations Climate Conference (COP), in Dubai, where he stated that “At least it will be clear who was to blame for there being no agreement.”
Lula’s statements took place on Saturday, December 2, hours after the French president, Emmanuel Macron, showed his firm opposition to the free trade agreement, declaring that it contradicts the defense of biodiversity and the fight against climate change.
“It is an agreement (EU-Mercosur) that is not good for anyone,” said the French president, at a press conference, also in Dubai.
The EU’s ‘green’ obstacles
The French president, Emmanuel Macron, has been one of the most critical voices of the agreement within the European Union and has said that the treaty is “outdated” and “contradictory” to the fight against climate change.
“I am creating in my country a market in the process of decarbonizing to allow people here to consume products from abroad that involve more emissions. We would be crazy,” commented the President of France in Dubai, where he clarified, however, that he has “a lot of harmony” with Lula da Silva and that he will visit Brazil next year.
The European Union has presented a series of demands to Mercosur to completely close the free trade agreement, including strict environmental regulations, like those applied in the Old Continent.
At the previous Mercosur summit, held last July, the outgoing Argentine president, the Peronist Alberto Fernández, harshly criticized the European position and pointed out that it is a “partial vision of sustainable development.”
“The European proposal is excessively focused on the environment, with no record of the three dimensions of sustainability: environmental, economic and social,” Fernández highlighted on July 4, echoing the statements of his Brazilian counterpart, who at that time stated that strategic partners do not negotiate “on the basis of mistrust and the threat of sanctions.”
European protectionism?
Although in European discourse environmental reasons seem to be what is holding back the definitive ‘YES’ to the agreement, President Lula da Silva has pointed to a protectionist nationalism in some EU countries.
“Each country has the right to have a position. France has always been the most difficult country to reach agreements, because it is more protectionist. It is not the same position as the European Union,” the Brazilian president emphasized in Dubai, adding that Paris has with the objective of “protecting the millions” of local producers.
According to critics of the agreement, with a combined market of just over 780 million people, the free trade agreement between both blocs can affect the business of European farmers, since the main exports of the Mercosur countries include goods related to agriculture. meat, seeds and raw materials, such as rubber and leather, of which Brazil is one of the main global producers.
Other EU leaders, such as the President of the Spanish Government, Pedro Sánchez, and the German Chancellor, Olaf Scholz, have met with the Brazilian president to explain their openness to the signing of the agreement and explain to him that, although the liberalization of tariffs It has to be gradual depending on the economic sector, doubts are still in the air.
The pressures within Mercosur
The progressive presidents of Brazil and the outgoing president of Argentina assumed that the technical agreement will not be signed before the bloc’s summit, while other voices warn of breaking the harmony of Mercosur if an agreement is not reached with the EU.
and both the outgoing president of Argentina, Alberto Fernández, and his chancellor, Santiago Cafiero, who will hand over their positions on December 10 when the far-right economist Javier Milei takes office, indicated that the signing of the pact is not yet possible in the current version of the text.
Cafiero stated in an interview with the Argentine newspaper La Nación this Sunday that his country would not sign the pact this week, destroying the expectations raised by Lula da Silva, the Uruguayan Luis Lacalle Pou, and the president of the European Commission, Ursula. von der Leyen.
“The talks will continue and a lot of work has been done, but the conditions are not met to sign the agreement,” Cafiero emphasized.
In this regard, the conservative Luis Lacalle Pou, president of Uruguay, has shown his support for opening with China and the European Union, but has reiterated his concern with “the immobility” that Mercosur has shown. In that sense, he has warned that, if the agreements are not implemented, his Administration will unilaterally seek new treaties with the European bloc, something it has already tried with China, although Beijing said at the time that it preferred to move forward with negotiations as a bloc.
What can you expect?
In an interview for France 24 in Spanish, the Costa Rican internationalist and expert in Latin American studies Mauricio Ramírez shared his vision of the agreement and mentioned that, due to the Latin American situation and the changes in Government, this week’s Mercosur summit could be a moment limit to finalize the pact.
“It is something very strategic for both parties, however, I believe that time is gaining and if between now and December 7 there is no ‘white smoke’, it is very difficult to be able to agree,” said Ramírez, who explained that Latin America is a highly competitive market, both from China and from the United States and Europe.
“There is a global situation of strategic competition. On the one hand, China and, on the other hand, Europe and the United States, to lead the digital era and the energy transition. It is essential to understand the strategic dependence that exists on both sides of this competition towards Latin America,” the internationalist stressed, when mentioning the reserves of lithium, one of the essential minerals for technological development, that exist in the region.
Ramírez stressed the importance of signing the agreement before the end of the year by recalling “the political swing of Latin American governments in the last 23 years”, a phenomenon that, for the Costa Rican, creates “instability” in the negotiating arena of both blocks. .
In the case of Argentina, the future chancellor, Diana Mondino, expressed that the new Government, which will be presided over by far-right economist Javier Milei from December 10, would have no problems with the outgoing Alberto Fernández signing the agreement in the coming days. .
“We have done everything possible to make it clear that we would appreciate it if Alberto Fernández, as outgoing president, could finalize the agreement,” said Mondino, on November 30, at a conference of the Argentine Industrial Union held in Buenos Aires.
Ramírez warned, however, about possible instability within Mercosur that the emergence of the far-right could cause and the impact on the agreement with the EU.
Between disagreements with European counterparts and the uncertainty of the future in Mercosur, South American leaders are heading to the next summit of the bloc, aspiring to be able to form a unified and solid position.
With EFE, Reuters and local media
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