Mercosur’s Response to EU Trade Expected in September, Brazil Minister Informs Farm Caucus, Reuters Reports

BRASILIA (Reuters) – The South American trade bloc Mercosur is set to present its counterproposal regarding an addendum to a long-awaited trade agreement with the European Union by September, according to Brazil’s Foreign Minister Mauro Vieira.

During a meeting with the country’s agricultural caucus in Congress, Vieira explained that the delay in formulating Mercosur’s counterproposal was due to a recent change in government in Paraguay. However, Pedro Lupion, the leader of the farm caucus, announced that Paraguay would provide its response by September 17.

Brazilian President Luiz Inacio Lula da Silva commented during a visit to Angola that the EU’s proposed side letter contained unacceptable "threats" regarding penalties for individual countries.

European negotiators have been awaiting a response to their addendum since March. This addendum includes environmental safeguards to address concerns raised by several EU member nations about the trade deal, which has been in negotiation for two decades.

Lupion, a lawmaker from Parana state, stated that the Mercosur counterproposal would include realistic objectives and criticized the EU side letter as "inconceivable," asserting that the European Union’s environmental guidelines would render agricultural production in Brazil impractical.

He emphasized the need for Brazil to consider its trade relationships with the EU, highlighting that the European market accounts for 16% of Brazilian food exports compared to a substantial 38% for Asia.

Conversely, Jose Medeiros, another lawmaker from Mato Grosso, expressed a differing view, suggesting that the environmental issues at play were secondary and potentially resolvable. "This accord should have been signed long ago. It’s a win-win for both blocs," he stated.