In a bid to rescue their protracted trade negotiations, Mercosur countries in South America are contemplating a high-stakes summit with top European Union officials.
The summit, tentatively set for late January or early February in Brasília, seeks to overcome the stumbling blocks that emerged during a December summit of Mercosur countries.
As the fate of the trade agreement hangs in the balance, Ursula von der Leyen, President of the European Commission, finds herself navigating a precarious situation, hoping for an eleventh-hour resolution to salvage the deal.
Initial optimism for a breakthrough in the trade pact between the EU and the Mercosur group — comprising Argentina, Brazil, Paraguay, and Uruguay — was dashed with the election of libertarian right-winger Javier Milei as the president of Argentina.
Outgoing Argentinian President Alberto Fernández, citing adverse impacts on local businesses, abruptly withdrew his support for the deal, sending shockwaves through both EU and Mercosur leadership.
Fernández’s unexpected about-face, especially after having previously championed the agreement, cast uncertainty over the fate of the trade pact, which has been under negotiation for nearly a quarter of a century.
Adding to the complexity, France revived its opposition to the deal on the European side, further complicating the diplomatic landscape.
Despite these setbacks, a glimmer of hope has emerged for a potential breakthrough before the expiration of the European Commission’s mandate and the upcoming European Parliament elections in June.
The current chair of the Latin American group, Paraguay, initially skeptical, has indicated a willingness for Brazil to continue leading negotiations with the European Commission.
According to Politico’s sources within Mercosur, technical-level meetings are scheduled throughout January to address lingering differences, particularly in the trade and sustainability chapter.
The negotiations will also delve into concerns about providing increased protection to Mercosur companies against European competition in procurement.
While the exact date of the impending summit remains unconfirmed, it is likely to coincide with or follow the internal meeting of Mercosur countries on January 31.
