EU eyes Mercosur deal; green hydrogen plant in Piauí

The telephone conversation between Brazilian President Luiz Inácio Lula da Silva and the president of the European Commission, Ursula von der Leyen, on Monday, had the objective of showing interest in accelerating the conclusion of the trade agreement between Mercosur and the European Union (EU).

While the call had been planned for weeks, it gained further significance after Javier Milei‘s victory in the Argentine presidential election on Sunday.

In a statement regarding the conversation between Lula and Ursula von der Leyen, the Brazilian government emphasized that it ‘holds the presidency of Mercosur until December 7 and has been discussing with the European Union the final points of the agreement between the two blocs.’

In this context of ‘Milei risk’ and hopes to finalize the agreement by December 7, two questions persist:

First, does the Alberto Fernández government still feel empowered to negotiate anything when it has less than 20 days in power?

Second, does the Fernández government truly desire this agreement with the EU? According to key sources, Argentina presents the most challenging demands, making negotiations less straightforward.

However, Ursula von der Leyen showed interest beyond Mercosur during the presidential call. A massive green hydrogen project in Piauí caught her attention and was part of her opening speech for European Hydrogen Week in Brussels.

Ursula von der Leyen announced with Lula the EU’s support for the construction of one of the world’s largest hydrogen plants in the state of Piauí. ‘It will be part of a €2 billion investment by Global Gateway in the hydrogen value chain in Brazil,’ she said. The Global Gateway is the European response to China’s New Silk Road, Beijing’s major project to strengthen its global influence.

This new Green Energy Park in Piauí will be a 10 GW clean hydrogen and ammonia production facility, which will be shipped to the island of Krk, Croatia. From there, the Piauí-produced hydrogen will serve industrial suppliers in southeastern Europe. ‘Simultaneously, this project will create local jobs and foster value chains in Brazil,’ she added.

Rafael Fonteles, the governor of Piauí, who is in Brussels, has emphasized that natural conditions such as heat, wind, and water make Piauí a strategic asset to become one of the world’s largest producers of this new clean fuel.

Participating in the Piauí project puts the EU in a privileged position to develop a global market for clean hydrogen. The EU has already signed hydrogen partnerships with countries ranging from Egypt, Kenya, and Namibia to Latin American countries. ‘Exciting new initiatives will come to light and be discussed’ with Kazakhstan, Australia, and Oman.

For Ursula von der Leyen, this illustrates that Europe is not just a pioneer in clean hydrogen but also a key partner when it comes to building a global hydrogen market.

As she did not fail to mention, the hydrogen economy is flourishing. She reported that the first hydrogen-based buses are operating in European cities from Riga to Barcelona. Construction has just begun at the Port of Rotterdam to build a hydrogen network that will span over a thousand kilometers. And weeks ago, the world’s first aircraft powered by liquid hydrogen crossed the skies of Slovenia.

The European Commission has authorized over €17 billion in state aid for about 80 hydrogen projects in the community bloc. The so-called European Hydrogen Bank has more resources to lend.

Source: Valor Econômico

Click here to read the original text: https://valor.globo.com/opiniao/assis-moreira/coluna/ue-de-olho-no-mercosul-e-no-hidrogenio-verde-no-piaui.ghtml

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