A list of approximately 20 petrochemical products is the main obstacle to the completion of a free trade agreement between the Mercosur and the UAE.
Negotiations began in 2024 and advanced rapidly between the two sides. According to reports made at CNN By authorities directly involved in the negotiations, there is a real possibility of closing the deal this year, as the differences taught in a few issues.
The main one, according to the sources, is the claim of the United Arab Emirates to zero the imports of imports from Mercosur to about two dozen petrochemicals.
It is a segment in which the Arabs – large oil producers – are highly competitive and Brazilian industry has special sensitivity to protect themselves from external competition.
Mercosur has told the United Arab Emirates that, given the country’s attempt to diversify its economy, it is significant to consolidate access to the South American market with zero fare for dozens of whole sectors.
The argument is that this may not be relevant today, but the United Arab Emirates intend to have a more dynamic industry in the future and would make a difference later.
The main export products in Brazil to the United Arab Emirates are chicken meat, beef and sugar. In the opposite direction, the largest imports are oil, urea, sulfur and aircraft parts.
In April, on the sidelines of the BRICS Chancellers meeting, the Minister of International Arab Emirates, Reem Al-Hashimy, expressed optimism with the possibility of a free trade agreement with Mercosur in 2025.
In addition to growing trade, one of the highlights of the bilateral relationship is the investments of the UAE in Brazil. Companies and funds such as Mubadala, Abu Dhabi Investment Group (ADIG), Edge Group and DP World have rapidly increasing their presence in the country.
