By the end of the year, they want to agree on a free trade agreement with the Mercosur countries. But there is disagreement on one central point.
Brazilian President Luiz Inácio Lula da Silva has rejected the additional declaration demanded by Brussels on the planned free trade agreement between the European Union and the South American economic alliance Mercosur. “This is unacceptable,” he said Tuesday at the summit of Mercosur heads of state and government in Puerto Iguazú, Argentina. “We don’t want an agreement that condemns us to being just suppliers of raw materials forever,” Lula said.
He had previously announced a counter-proposal. “I would like to work to ensure that we can conclude the agreement with the European Union in these six months and think about other things,” said the head of state with a view to the Brazilian Mercosur presidency for the next six months. “We want to discuss the agreement, but we don’t want to be forced into anything.”
“Focus too much on environmental protection”
Argentina’s President Alberto Fernández also criticized the additional declaration on climate, environment and human rights proposed by the EU. “It puts too much focus on environmental protection without considering economic and social sustainability,” he said. He also accused the EU states of protectionism, especially in agriculture.
The free trade agreement between the EU and Mercosur has been on hold since negotiations concluded in 2019. Mercosur includes Brazil, Argentina, Uruguay and Paraguay. The treaty would create the world’s largest free trade zone with 780 million people. Above all, he should reduce tariffs and thus boost trade. The agreement still has to be ratified by all member states. However, it is controversial in both South America and Europe.
Some countries want to protect their markets, others fear that labor or environmental standards will be weakened. During her trip to South America, EU Commission President Ursula von der Leyen called for the free trade agreement to be implemented as quickly as possible.
