After meeting with president, European leader cites “obstacles” to signing agreement
Ursula von der Leyen and Luiz Inácio Lula da Silva — Foto: Gustavo Moreno/AP
The trade agreement between the European Union and Mercosur, which has been under negotiation for two decades, dominated the visit to Brasília on Monday of European Commission President Ursula von der Leyen. During a ceremony at the presidential palace, President Luiz Inácio Lula da Silva complained about the changes proposed by the Europeans in March, which he said have unbalanced the agreement. The European leader was more evasive, praising the importance and dimension of the agreement, but citing “obstacles” to its conclusion.
Besides the meeting with Mr. Lula, Ms. von der Leyen participated in an event organized by the National Confederation of Industry (CNI). During the ceremony, the president of the entity, Robson Andrade, advocated the signing of the old version of the text, which reached consensus in 2019, but in the end, was not signed. Mr. Lula defends the changes in the version announced by his predecessor, Jair Bolsonaro.
One of the points that the Brazilian president will not give up is that of government purchases. The idea is to increase the margin of preference for small and medium-sized companies. Mr. Lula recalled that developed countries have returned to giving large subsidies to their industries and claimed the right to do the same.
“After cycles of exaggerated liberalism, Europe and the U.S. again recognized the importance of state action in industrial policy. Billions of dollars in subsidy programs were adopted in the developed countries in favor of reindustrialization,” the president said. “Brazil, which has suffered severe deindustrialization, has similar ambitions. That is why it will retain the power to implement industrial promotion policies through the instrument of public procurement,” he added in his speech.
The Brazilian president also complained about the European plan to punish Brazil, especially for environmental issues. According to Mr. Lula, “the premise that must exist between strategic partners is mutual trust, not mistrust and sanctions.”
At the Presidential Palace, Ms. von der Leyen said that “the time has come to conclude the agreement” and that he expected this to happen “by the end of the year at the latest.” However, she did not comment on Mr. Lula’s criticism. At CNI, she said that the agreement was “close to being concluded” but that there were still “obstacles” that could “shorten” trade flows and the potential of the relationship between the two blocs. She did not elaborate on the obstacles, saying only that the agreement is the “largest and most ambitious ever negotiated” and that “its benefits are clear”.
“Our agreement will set clear parameters for workers’ rights, environmental protection, and sustainable supply chains,” she said. “That means consumers will have confidence in the products they buy,” the European official added.
The two leaders also discussed the war in Ukraine. Mr. Lula reiterated Brazil’s position condemning the Russian invasion, but said that “there is no military solution to this conflict.” “We need more diplomacy and less armed intervention in Ukraine, Palestine, and Yemen,” he said. He also defended again an overhaul of the United Nations Security Council, a collegiate body on which Brazil’s government is seeking a permanent seat.
“The reform of the institutions of global governance, especially the global financial system, can no longer be postponed to put them at the service of production, work, and employment. The reform of the United Nations Security Council is a guarantee that we will have the collective capacity to respond with efficiency and credibility to threats to international peace and security,” Mr. Lula said.
An early ally of Ukraine, Ms. von der Leyen said any peace proposal must be in line with United Nations conventions. “Of course, we want peace. And nobody wants it more than the Ukrainians themselves. But it has to be a fair peace. A peace that upholds the principles of the UN Charter and the right of the Ukrainian people to be masters of their own future,” she said, quoting Ukrainian President Volodymyr Zelensky’s proposal.
After her stop in Brazil, the European Commission President will travel to Argentina, where she will meet with President Alberto Fernandez and participate in an economic forum. On Wednesday, she will meet Chilean President Gabriel Boric in Santiago. The EU’s recent outreach to Latin America reflects European concerns about the growing involvement of Chinese investment in the region.
*Por Murillo Camarotto, Fabio Murakawa — São Paulo
Source: Valor International