Leaders of the economic blocs meet this Saturday (17), in Asunción, to conclude the historic treaty, amid growing protectionism and geopolitical tensions
The countries of ea sign this Saturday (17), in Asunción, the free trade agreement after 25 years of negotiations. Representatives from both blocs will sign the agreement at the Gran Teatro José Asunción Flores of the Central Bank of Paraguay, a place full of symbolism, as it was there that Mercosur was founded in 1991.
The trade war triggered by the president of the United States, the increasing dependence on China and geopolitical tensions, with the war in Ukraine and the crisis in the Middle East still in force, pushed both parties to overcome their historical differences and seal an agreement that was as celebrated as it was criticized.
Confirmed attendance
The ceremony will begin at 12pm and the host of the meeting will be the Paraguayan president, Santiago Peña, whose country holds the rotating presidency of Mercosur. The European delegation will be led by the President of the European Commission, Ursula von der Leyen.
According to official Paraguayan sources, the presence of the presidents of Argentina, Javier Milei; from Uruguay, Yamandú Orsi; from Panama, José Raúl Mulino; and from Bolivia, Rodrigo Paz. Panama recently joined Mercosur as an associated state and Bolivia is in the final process of joining as a full member of the South American group.
This way, barring a last minute change, the one of the great defenders of the pact, will be the only one absent among the leaders of the founding countries of Mercosur.
Brazilian unofficial sources stated that, in principle, the act only provided for the presence of foreign ministers, who will sign the treaty on behalf of the South American forum.
However, as it was a historic event, Paraguay subsequently decided to invite representatives from member countries. The aforementioned sources deny that Lula’s absence is due to ideological differences with any of his peers and attribute it to scheduling problems.
However, one day before the signing, Lula received this Friday in Rio de Janeiro, where they discussed the next steps of the trade agreement, among other topics on the international agenda.
Meeting with the President of the European Commission, Ursula von der Leyen
In addition to Lula’s absence, Brazil – the largest economic power in Latin America and which led negotiations with the EU – enthusiastically defends the agreement, which will create the largest free trade zone in the world by population, with 720 million people and an economic weight of US$22 trillion.
“This agreement will bring more jobs, more income, it will strengthen agribusiness, industry and, as a consequence, services and reciprocal investments. More Europeans will invest in Brazil and we will also invest in Europe”, said vice-president, Geraldo Alckmin, on Thursday.
In the same vein, the chancellor of Paraguay, Rubén Ramírez Lezcano, highlighted to his country’s congressmen that it is one of the “most important agreements in economic terms on the planet” and celebrated the fact that a balance had been reached, although neither party is 100% satisfied.
Gradual elimination of tariffs
The treaty will reduce or gradually eliminate tariffs on around 90% of exports between the EU and Mercosur. It also provides for the possibility of applying bilateral safeguard measures in the event of a large price difference. On the South American side, one of the biggest beneficiaries will be the agricultural sector, while in Europe the highlight will be industry.
Thus culminates an odyssey that began in 1999. A principle of political agreement was reached in 2019 and, finally, the negotiation process was concluded on December 6, 2024, after the addition of an annex on the environment and adjustments in chapters of interest to South Americans, such as government purchases.
The text advanced within the EU with the support of 21 of the 27 partners. Only five voted against: France, which led the opposition, Poland, Austria, Ireland and Hungary – all of which see the deal as a threat to their agricultural sectors. Belgium abstained.
In fact, protests by European producers have not stopped in recent weeks. However, the agreement’s entry into force will not be automatic after signature, as ratification stages must still be completed on both sides of the Atlantic.
*With EFE
