Argentina wants ‘balanced agreement’ between EU and Mercosur – 06/13/2023 – Market

The president of Argentina, Alberto Fernández, echoed Luiz Inácio Lula da Silva (PT) and stated that the country wants a balanced agreement between the European Union and Mercosur. Alongside the president of the European Commission, Ursula von der Leyen, he signaled that there are still obstacles to the approval of the text, but that they are not difficult to resolve.

The two leaders met this Tuesday (13) at the Casa Rosada, in Buenos Aires, a day after the German went to the Planalto Palace, during a tour she is making in Latin America. After the meeting in Brasília, Lula criticized the Europeans’ extra environmental demands and said that the premise of the negotiations should not be “distrust and sanction”.

Fernández also expressed disagreements, but in a less harsh tone: “We effectively want an agreement with the European Union, but one that balances the economies of each of the regions. And that takes this symmetry into account, because otherwise it could be […] an agreement that benefits the European Union more and not so much us”, he told the press in a joint statement after the conversation.

He asked, however, not to be “misunderstood” after the European leader was questioned about an apparent resistance from the two South American countries. “Don’t take what I said as if we weren’t aligned,” she declared. “I will be very happy if we sign this agreement by the end of the year,” he added.

According to the Peronist leader, there are “specific issues to unlock the agreement, not to block it”, and there is political will to do so. Negotiated since 1999, the commercial partnership between the blocs was signed in 2019, in the first year of the Jair Bolsonaro (PL) government, but has been at an impasse since then, without ratification by both sides.

“[Os problemas] they have to do with the protectionism of some European countries for agricultural and grain production. And another problem is the Green Pact that Europe signed to improve European development, but which inevitably affects the agreement. […] These are problems that we can solve, they are not difficult,” he said.

Fernández also said that he considers that Europe’s concern, mainly that of French President Emmanuel Macron, with the deforestation of the Amazon “disappeared” since Lula took office, “because the president [brasileiro] does not participate in these policies, and, on the contrary, he and [a ministra] Marina Silva are great promoters of caring for the environment”.

In April, the European Parliament approved a law that prohibits the importation into the continent of products originating from deforestation in forests, which includes cattle, wood, soy, coffee, cocoa, rubber and palm oil, in addition to its derivatives, such as leather, chocolate, furniture , charcoal and paper products.

The current agreement has sustainability standards that are non-binding (ie mandatory), so the blocs are negotiating an additional term, called a “side letter”, that makes these environmental commitments a requirement. In an interview at the end of April, Lula had already said that the current proposal was impossible to accept.

France is one of the main opponents of the deal as it stands. The country defends, among other things, the inclusion of what would be “mirror clauses”, that is, products can only enter the EU if they follow the same conditions that the bloc imposes internally.

Von der Leyen, in turn, repeated that the two blocs are experiencing “a window of opportunity” to close the agreement politically and that he wants to complete it by the end of the year — after that, the text would still have to undergo technical analysis and by the European Parliament, for example, until it enters into force.

“We sent the first letter and are waiting for your reply [o mais rápido possível]”, she declared, also in a milder tone than what she seems to have addressed to Lula, to whom she said that she waits “with impatience” for a return to hear what the country has to propose.

In her speech, the German, considered one of the most powerful women in the world, insisted several times that the European Union “wants to go further” in relations with Argentina, which already has the European bloc as its biggest partner, equivalent to 40% of investments foreigners —she announced a contribution of 10 billion euros (about R$53 billion) throughout Latin America during the visit.

Both leaders signed this Tuesday a memorandum of understanding on lithium, a mineral used in electric vehicle batteries, whose interest has skyrocketed in the last year, to supply the Global North’s search for cleaner energy sources. Argentina is part of the “lithium triangle”, which together with Bolivia and Chile holds more than half of the world’s reserves.

“In addition to extraction, we believe it is very important to add value and that the investment stay in the region, generating work and knowledge in the region. The whole world is embarking on green energy, it is Argentina’s opportunity to develop its production chain,” she said.

After Brasília and Buenos Aires, Von der Leyen should still visit Santiago this Wednesday (14th) and Mexico City this Thursday (15th), relevant actors in the so-called Global South, disputed by the opposing poles in the war between Russia and Ukraine. The visits take place one month before the conference between the European Union and Celac (Community of Latin American and Caribbean States), on July 17th and 18th in Brussels.