© Reuters. FILE PHOTO: Brazil’s President Luiz Inacio Lula da Silva and his Argentine counterpart Alberto Fernandez attend a summit of leaders of the Mercosur group, in Puerto Iguazu, Argentina July 4, 2023. Maria Eugenia Cerutti/Argentine Presidency/Handout via REU
BRASILIA (Reuters) – South American trade bloc Mercosur has responded to the EU’s additions to their long-awaited trade accord, Brazil’s Foreign Ministry said on Thursday, and negotiators will speak later in the day.
Splits within Mercosur have dampened European hopes for the trade deal that was reached in 2019 after two decades of negotiations but has been on hold due to environmental concerns. Brazil currently holds the pro tempore presidency of Mercosur.
“Mercosur’s response to the EU was sent last night,” a foreign ministry spokesperson said.
“Today there is a video-conference between Mercosur and the EU to advance the discussion, which has been the subject of frequent meetings between negotiators,” he said.
Two European diplomats confirmed this was the case.
A source at Paraguay’s foreign ministry told Reuters the Mercosur countries have appeared to agree on a response to the EU, overcoming tensions within the trade bloc that had delayed a joint reply.
“There is a general agreement with Brazil not to accept terms that hurt the development of the Mercosur nations,” the source said.
Earlier this year, the EU presented Mercosur with an addendum to the agreement that included environmental safeguards to address reservations by many EU member states.
Brazil called the additions protectionist and pushed back against more open government procurement provided for in the proposed trade deal.
Diplomats worry the accord, which would represent the largest trade deal struck by the EU in terms of population, could fall apart if it does not get completed by the end of the year.
EU negotiators have been waiting for Mercosur’s reply since March. Many had hoped for a swift conclusion to the agreement under President Luiz Inacio Lula da Silva, who overhauled Brazil’s environmental policies to protect the Amazon (NASDAQ:) rainforest since taking office this year.
