With U.S. tariffs rising, French chamber urges to back EU-Mercosur deal

“Everything happening now only reinforces the urgent need to deepen economic integration between the European Union and Mercosur,” said Mr. Besse, a French-Brazilian who also serves as institutional director of Vinci Concessions, an airport and highway operator. The interview took place on July 30, just minutes after U.S. President Donald Trump signed a decree imposing 50% tariffs on Brazilian products and three days after the U.S. and EU reached a separate trade deal that set tariffs at 15% for most European exports.

“We urgently need to advance integration between these blocs—and especially, in our case, between France and Brazil—because there is predictability, trust, long-term vision, and partnership here,” Mr. Besse said.

A longtime advocate of the EU-Mercosur deal, Mr. Besse emphasized that the agreement would benefit both regions, particularly France–Brazil trade. “We hope for swift ratification, because time is passing and the need for this agreement is increasingly clear.”

The São Paulo regional office is one of four in Brazil under the France-Brazil Chamber of Commerce, and it represents more than 70% of the chamber’s 500 member companies. According to Mr. Besse, a strong majority supports the EU-Mercosur deal.

The agreement would create a market of over 750 million consumers—about 10% of the global population—and a combined GDP of around $22 trillion, or roughly 20% of global GDP.

However, France remains the biggest obstacle to ratification. That stance may shift, Mr. Besse noted, as French President Emmanuel Macron and other European leaders grow increasingly frustrated with the recent EU-U.S. trade pact.

“The world seems increasingly volatile and irrational. In this challenging environment for businesses, it’s clear that long-term partnerships and trusted relationships matter more than ever. The Chamber, which just celebrated its 125th anniversary, is a living testament to the strength of the France–Brazil relationship,” said Mr. Besse, without directly commenting on the U.S. decision.

“French investment in Brazil and bilateral trade have evolved largely independent of political cycles. French companies invest in Brazil with a long-term outlook, which is very healthy for economic relations between our countries.”

According to Mr. Besse, signs point to continued growth in the relationship. Despite Brazil’s economic volatility, French companies and investors have maintained their presence. Chamber data shows that 1,300 French subsidiaries currently operate in Brazil, employing over 500,000 people and generating more than €61 billion in revenue in 2024 (approximately R$390 billion).

“That’s double Vale’s 2024 revenue,” he said, referencing the Brazilian mining giant’s R$206 billion net revenue, “and almost the size of Petrobras’s,” which posted R$490.8 billion the same year. “It’s a very significant volume.”

Mr. Besse described the current phase of bilateral economic relations as highly positive, with Brazil becoming a “privileged destination” for French investment. “France is not focused on just one sector. French companies are present across the economy—from aerospace and defense to retail, infrastructure, energy, and luxury goods.”

According to Brazil’s central bank, France was the country’s third-largest foreign investor in 2023, with a stock of $66.3 billion—just behind Spain ($66.7 billion) and the United States ($272.8 billion). The Chamber added that Brazil is the second-largest emerging market for French investment, trailing only China.

Among the sectors where French investment is strongest, Mr. Besse highlighted energy transition. French companies have been building and financing solar plants—particularly in northeastern Brazil, but not exclusively—and are also active in wind energy.

Despite the already strong French presence, Mr. Besse sees room for growth—especially in trade. In 2024, trade between the two countries totaled $9.1 billion, which the Chamber still considers “modest.” President Lula has even called the figure “a shame,” given the size of both economies.

According to Mr. Besse, the EU-Mercosur deal could help unlock this potential—particularly for small and medium-sized enterprises (SMEs), which face the biggest barriers to entering foreign markets. “There is still great potential for increased exports by French companies to Brazil—and vice versa.”