Mercosur meets in Rio with agreement with the EU on the edge of the precipice

The leaders of Mercosur (Argentina, Brazil, Paraguay and Uruguay) meet on Thursday in Rio de Janeiro with the free trade agreement with the European Union (EU) in stalemate, after the umpteenth disagreement between the two blocks.

The Brazilian president, Luiz Inácio Lula da Silvawill host the LXIII Summit of Mercosur Heads of State, which will serve to clarify whether there is still strength to complete the agreement with the EU or if it is buried once and for all after more than two decades of negotiations.

The horizon is not encouraging at all. When it seemed that a consensus was going to be reached that would put the final touch on the political agreement reached in 2019, doubts on both sides of the Atlantic have once again put the pact on the brink of the abyss.

In Rio, Brazil will pass the pro tempore presidency of the Southern Common Market (Mercosur) to Paraguay, whose president, Santiago Peña, has announced that he will not give priority to dialogue with the Europeans and will bet on other markets.

“We are looking the other way,” Peña stated in an interview with a local media.

The semiannual presidency of the European Council will also fall in 2024 to Belgium, which is part of the group of Twenty-seven that is suspicious of the alliance with the South Americans, and Hungary.

The ‘Milei effect’ and the rejection of France

A new unknown has been added to that equation: Argentina. In Rio, President Alberto Fernández will say goodbye to his associates since next Sunday he will hand over power to the ultraliberal Javier Mileiwho will not travel to Brazil.

Milei ranted against Mercosur during the elections that he won on November 19 and said that, in the molds in which it is today, “It does not work”.

“No one knows what to expect from Milei, although the campaign proclamations do not come true”said Ligia Costa, specialist in International Law and professor at the Brazilian Getúlio Vargas Foundation.

The future chancellor of Argentina, Diana Mondino, has been in favor of the trade agreement, although she has already conveyed her wish that the Fernández Government would not leave that hot potato in her hands.

In the last month, the negotiating teams met practically daily and achieved “substantial progress” to have a definitive text ready at the Rio Summit.

The political tempo seemed to be ideal, with Lula, a beacon of Latin American progressivism, and the head of the Spanish Government, the socialist Pedro Sánchez, at the head of the rotating presidencies of both blocs.

But everything was blown up by Argentina’s reluctance on the eve of a transfer of power and the skepticism of some European countries, led by France.

President Emmanuel Macronunder pressure from his country’s agricultural industry, pointed out that the EU-Mercosur agreement “it’s not good for anyone” and insisted that “It does not take into account biodiversity or climate.”

Lula called France “protectionist” and on Monday, within the framework of an official visit to Germany, he said that Macron’s position is in line with that of all his predecessors with whom he has had contact in his other two mandates (2003-2010).

“Despite everything, I will continue to persist,” said the Brazilian leader.

However, Costa believes that at the summit of presidents “nothing will happen”.

“Only after Milei takes office can we negotiate and see what happens. “The agreement is very important for Mercosur and the EU,” express.

Mercosur will sign a free trade agreement with Singapore in Rio and will formalize negotiations with the Dominican Republic and El Salvador.

Bolivia, new partner

The Rio Summit will also serve to welcome Bolivia as a new member of the bloc created in 1991.

The Andean nation was a State associated with Mercosur since 1998 and in 2015 it signed the accession protocol, which required the endorsement of the legislative bodies of Argentina, Brazil, Paraguay and Uruguay.

Only Brazil was left to ratify his appointment in Parliament, which finally happened last Tuesday.

Bolivia now has up to four years to adapt its legislation to that of Mercosur and thus materialize its de facto incorporation.

The meeting of presidents will be preceded by a meeting of the bloc’s Ministers of Economy and Foreign Affairs, which will be held on Wednesday, and by the Mercosur Social Summit, which between Monday and Tuesday brought together 300 representatives of civil society.