Mercosur agreement with Europeans will not be closed now, confirm Lula and EU

President Luiz Inácio Lula da Silva (PT) and the head of European Union (EU) diplomacy, Josep Borrell, confirmed this Tuesday (18) that the trade agreement between Mercosur and the Europeans will not be closed now during the 3rd Celac Summit -UE, held since Monday (17) in Brussels, Belgium.

The expectation, however, is that the partnership between the two economic blocs will be completed by the end of the year, and a meeting between representatives is being negotiated for the month of August to “discuss outstanding points”. This week, the Brazilian government forwarded to Argentina, Paraguay and Uruguay the proposed letter of response that will be sent to Europeans on the new requirements, mainly environmental, made by the parliaments of the countries of the bloc.

“We concluded the Mercosur agenda, we have already sent it to the presidents [a carta] to presidents, it will not be discussed here
[em Bruxelas] because it is not Celac that has to make the agreement, it is only Mercosur”, said Lula in the weekly live Conversation with the President, broadcast this Tuesday (18).

Lula’s statement was confirmed by Borrel, who said that “for the first time, there were two texts on the table: the proposal from the European side and the counter-proposal from the Latin American side regarding environmental issues.”

“There will not be a breakthrough, but there is a clear desire to continue working based on the two proposals. I’m sure that, by the end of the year, we can reach an agreement”, said the representative of the Europeans.

Agreement divides opinions among European countries

The finalization of the agreement, however, divided opinions throughout the first day of the summit. While German Chancellor Olaf Scholz said he was convinced that the partnership would soon be reached on an “equal footing”, his Austrian counterpart, Karl Nehammer, rejected approving free trade between the European Union and Mercosur.

“Our position has not changed,” he said, referring to the Austrian parliament’s 2019 decision to veto the deal. He also stated that there is an “intense debate” within the EU about the agreement and that his government “is unaware of the proposals for change”.

The free trade agreement between the two blocs has been negotiated for about 20 years and was finalized in 2019, still under the management of former President Jair Bolsonaro (PL). Discussions, however, have been stalled since the European bloc made a series of new environmental demands for the agreement to be endorsed.

The new impositions did not please the South American countries. Current president of Mercosur, Lula called the new requirements a “threat” and “unacceptable”.

nicknamed side letter, European terms were sent to Mercosur earlier this year. As the new proposal did not please the countries of the bloc, Argentina, Brazil, Paraguay and Uruguay were responsible for drawing up a new document for negotiation that took into account the challenges of the EU.