RIO DE JANEIRO (AP) 鈥� Brazilian President and European Commission President on Friday celebrated the between the EU and four South American countries the following day at a ceremony that Lula will not attend.
This is the first major trade agreement for Mercosur, which includes the region鈥檚 two biggest economies, Brazil and Argentina, along with Paraguay and Uruguay. The two blocs are expected to formally sign their trade pact this Saturday at a ceremony in Paraguay. Bolivia, the newest Mercosur member, was not involved in negotiations but can join the agreement in the coming years.
While local media reported that Argentina鈥檚 Javier Milei and Uruguay鈥檚 Yamand煤 Orsi will be present at the ceremony hosted by Paraguay鈥檚 Santiago Pe帽a, Lula decided not to make the trip to the capital Asuncion.
Instead, the Brazilian leader will be represented by Foreign Minister Mauro Vieira.
That caused some surprise, in light of Lula鈥檚 energetic efforts in favor of the deal, particularly since returning to Brazil’s presidency in 2023 for a third, .
Lula’s December disappointment
Experts say the move may hint at Lula鈥檚 disappointment the deal was not signed in December, when Brazil had the rotating presidency of Mercosur.
In Rio, Lula again pointed to how long the negotiations had taken.
鈥淚t was more than 25 years of suffering and attempts to get a deal,鈥� Lula said during a short statement to the press at Itamaraty Palace in downtown Rio alongside von der Leyen.
But he hailed the historic nature of the pact.
鈥淭omorrow in Asuncion, we will make history by creating one of the world鈥檚 largest free trade areas, bringing together some 720 million people and a GDP of over $22 trillion,鈥� he said.
The European Commission鈥檚 president paid warm tribute to Lula for his efforts in making the deal happen.
鈥淭he political leadership, the personal commitment and passion that you have shown in the last weeks and months, dear Lula, are truly second to none,鈥� said von der Leyen.
At a late press conference in on Friday, European Council President Ant贸nio Costa also said that the latest Brazilian presidency of Mercosur was crucial to advance negotiations, paving the way to its signature in Paraguay.
鈥淧ower of friendship鈥�
The significance of creating one of the world鈥檚 largest free-trade zones while U.S. yanks the United States is not lost on the signatories.
鈥淭his is the power of partnership and openness. This is the power of friendship and understanding between peoples and regions across oceans,鈥� von der Leyen said. 鈥淎nd this is how we create real prosperity 鈥� prosperity that is shared. Because, we agree, that international trade is not a zero-sum game.鈥�
The victory for the EU and Mercosur comes at the expense of the U.S. and China, experts say, as Trump aggressively in the resource-rich region and and to build influence.
The accord grants South American nations, renowned for their fertile land and skilled farmers, increased access at a preferential tax rate to Europe鈥檚 vast market for agricultural goods.
Apex, a Brazilian government investment agency, estimates that EU-bound agricultural exports like instant coffee, poultry and orange juice will rake in $7 billion in coming years.
But Lula on Friday warned that Mercosur would not limit itself to the 鈥渆ternal role鈥� of commodity exporters. 鈥淲e want to produce and sell industrial goods with higher added value,鈥� he said.
Flavia Loss, an international relations professor at Foundation School of Sociology and Politics in Sao Paulo, said that Lula鈥檚 absence on Saturday may be retaliation for the delay 鈥� another sign that Brazil and Mercosur are seeking equal terms with the EU.
鈥淚 see Lula鈥檚 absence as signaling: 鈥楾he deal is important but we鈥檙e not going to change everything for them,鈥欌�� Loss said.
Rebuke of MAGA logic
While the deal is asymmetrical and economically favorable to the European Union, politically the agreement is beneficial for both parties, said Roberto Goulart Menezes, an international relations professor at the University of Brasilia.
For the European Union, which is under pressure of Greenland, the deal shows that the group of countries is betting on the diversification of its partners and multilateralism, Goulart said, in a symbolic rebuke of Trump鈥檚 MAGA logic.
鈥淎nd for Mercosur, it illustrates that the bloc is relevant, despite accusations of being insignificant and on its last legs.鈥�
Speaking to journalists, Costa addressed criticisms that the deal favors the EU. 鈥淚t’s a trade deal, but it’s also an investment agreement. (…) Because our policy is not, unlike the Chinese approach, to simply arrive and extract the minerals so that the added value is generated elsewhere.鈥�
鈥淭here is no longer that post-colonial logic of going around extracting natural resources,” he said.
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