Brazil had everything ready to sign the historic agreement between Mercosur and the European Union this December 20. The setting was idyllic: the Belmond hotel, the most luxurious in Foz do Iguaçu, with the impressive Iguazú Falls in the background. But at the last minute the EU stood up to the South American countries and what was going to be a party turned into a lackluster Mercosur summit. and have hardened their tone against the EU. “Without the will and courage of politics, it will not be possible to close an agreement that we have been dragging on for 26 years,” said Luiz Inácio Lula da Silva in the opening speech.
The disillusionment with Europe and – like the United Arab Emirates, Canada, Vietnam and Indonesia – were the only coincidence of a bloc with great internal differences. The most visible, the position on Venezuela. Brazil and Uruguay opposed a US military intervention; Argentina aligned itself with Donald Trump and applauded the pressure he exerts against Nicolás Maduro. This same Saturday, in international waters.
“We are like the groom, waiting for the bride to show up,” lamented the president of Paraguay, Santiago Peña, in reference to the signing of the agreement that would create the largest free trade zone in the world, with 700 million consumers.
The Brazilian president, host of the meeting, warned that the world “is eager” to negotiate with a region that is the world’s largest producer of food. The countries that make up Mercosur—Brazil, Argentina, Paraguay and Uruguay—also have important reserves of oil, gas and critical minerals that China, the United States and Europe covet. “The time of economic opportunity is always short and cannot be subordinated to the time of bureaucracy and politics,” said Argentine Javier Milei.
The head of the European Commission, Ursula von der Leyen, did not appear at the meeting because, to convince Italy and have enough votes to sign. The presidents of Argentina, Milei, did arrive to this border city; Paraguay, Peña; and Uruguay, Yamandú Orsi. The head of State of Panama, José Raúl Mulino, also traveled as an associate country.
“Humanitarian catastrophe”
The biggest internal clash had to do with Venezuela. Brazil on Friday refused to approve a ministerial resolution proposed by Argentina and Paraguay to condemn human rights violations and threats to democracy in Venezuela. In his speech, Lula assured that a military intervention “would be a humanitarian catastrophe.” Orsi seconded him and asked that a “peaceful restoration of the institutional and democratic order of Venezuela” be carried out “peacefully.”
Milei believes that diplomacy has failed to stop “the atrocious and inhuman dictatorship of the narcoterrorist Nicolás Maduro.” “The time for having a timid approach has run out. Argentina welcomes the pressure from the United States and Donald Trump to free the Latin American people,” he declared.
The Argentine president also harshly attacked Mercosur for ignoring his requests for a comprehensive transformation that would allow bilateral negotiations outside the bloc. “The new South America comes from the future. It is up to this bloc to decide if it is going to move with this tailwind or cling to the mast of the past against this change that countries need and demand,” he stressed. The far-right leader criticized that Mercosur has not achieved many of the objectives with which it was created: “There is no common market, there is no effective free movement, there is no macroeconomic coordination, there is no real significant harmonization, there is no sufficient openness to the world. Yes, there is an oversized and ineffective bureaucracy,” he concluded.
The differences in speech between Lula and Milei are accentuated in personal treatment. In the family photo, the Argentine president passed behind the host without speaking to him and left space for Peña to be between the two of them. Later, they exchanged only a cold greeting.
The Brazilian president stated that in today’s world it seems easier to build walls than bridges, but even within Mercosur this multilateral construction encounters obstacles. Lula inaugurated on Friday a bridge that connects Brazil with Paraguay; Peña inaugurated it this Saturday. The chosen name, Integration Bridge, contrasts with the existing obstacles to the free movement of people and goods within the common space. The very course of the summit showed a chaotic organization: the host country only broadcast Lula’s speech openly. Paraguay chose to broadcast the presidential message through social networks and Uruguay and Argentina broadcast them recorded once they finished.
All members of Mercosur agree that together they are stronger than alone, but impatience with the lack of results prevails. Argentina is negotiating alone a free trade agreement with the United States and Uruguay has begun the process of adhering to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). The bloc has yet to find a response to these challenges without breaking up.
