However, the ultimate political negotiations involving all stakeholders could introduce complications
12/01/2023
/i.s3.glbimg.com/v1/AUTH_37554604729d4b2f9f3eb9ad8a691345/internal_photos/bs/2023/Z/b/dMtU8NTbWWJEULm5NhUw/260722-20fiesp-20003.jpg)
Tatiana Prazeres — Foto: Carol Carquejeiro/Valor
The impending Mercosur and European Union agreement, slated for announcement at the upcoming South American bloc summit, confronts no insuperable technical challenges. The Brazilian government is keen on making this announcement. However, the ultimate political negotiations involving all stakeholders could introduce complications. Consequently, the Mercosur-Singapore agreement will likely be the summit’s primary outcome, marking the bloc’s first in over a decade. This insight comes from Márcio Rosa, executive secretary, and Tatiana Prazeres, secretary of Foreign Trade at Brazil’s Ministry of Development, Industry, and Foreign Trade (MDIC), in a conversation with Valor.
“There is a longstanding political commitment to finalize the [Mercosur-EU] deal” tracing back to President Lula’s term commencement, said Secretary Rosa. He views it as “part of President Lula’s strategy to assert Brazil’s significant global role, engaging with major powers inclusively.”
Secretary Tatiana Prazeres highlights the “intense engagement” from all technical parties in these negotiations. She notes, “I lost count of how many videoconferences I had in the last ten days,” also highlighting the visits from European negotiators to Brazil. “Despite unresolved critical points, the Brazilian team envisages potential solutions,” added Secretary Prazeres.
According to her, these “critical issues are relatively limited.” These critical issues include government procurement and “environmental concerns, particularly deforestation,” where the Brazilian government sees procurement as a vital tool for domestic industrial policy.
Despite the electoral victory of Argentina’s president-elect, Javier Milei, who opposes the Mercosur bloc, technical talks within Mercosur remain uninterrupted.
“The Argentinians continue to actively participate,” Secretary Prazeres confirms. “But the truth is, as with any other trade negotiations, challenging decisions are typically deferred to the end. That is where we are now,” she added.
For the agreement to progress, consensus among all Mercosur members is necessary. Hence, Brazil is “closely monitoring” statements from Argentina’s incoming administration.
Despite external political factors, such as the European Parliament and Council elections, Secretary Rosa asserts, “It is premature to deem Argentina a dealbreaker.”
Secretary Prazeres clarifies that “if successful, only an announcement of the EU agreement is expected,” not its signing.
“[Post-announcement steps] involve legal reviews and translations, pushing the actual signing to the subsequent administration,” she said.
Contrastingly, the Mercosur-Singapore negotiations, initiated under President Michel Temer, are “nearing completion.” This deal aims to “open the pathways” for Mercosur to Asia beyond China, encompassing countries like Indonesia, Malaysia, and Vietnam.
Secretary Rosa underscores Brazil’s substantial trade ties with Singapore, the seventh-largest destination for Brazilian exports, which also hosts significant Brazilian companies, such as Petrobras, Embraer, WEG, Tramontina, and Seara. The agreement intends to modernize these relations, emphasizing “investment and service flows.” A deal between Mercosul and the Dominican Republic is also on Brazil’s agenda for the coming years.
The Mercosur Summit, scheduled for next Tuesday (6), will be attended by President Lula and European Commission President Ursula von der Leyen.
*Por Estevão Taiar, Lu Aiko Otta — Brasília
Source: Valor International