Mercosur to sign treaties with Canada and Lebanon in 2021

Negotiations for free trade agreements – between Mercosur and Canada, and between Mercosur and Lebanon – must be successfully concluded in 2021. The information is provided by the Foreign Trade Secretary, Lucas Ferraz. According to him, both agreements were moving along with prospects of entering the final stretch of the negotiations, but then everything slowed down during the pandemic. Canadians have not held negotiating meetings in an online environment. The Lebanese authorities, in addition to suffering from the restrictions imposed by Covid-19, needed to turn their attention to the impacts of the explosion that devastated the port of Beirut.

The graph below shows the volumes of trade between Brazil and Canada and Brazil and Lebanon:

Brazilian Cargo Handling to/from Canada and Lebanon | Jan to Oct 2020 | TEU

Graph source: DataLiner (To request a DataLiner demo click here)

Mercosur also discusses trade treaties with Singapore and Korea. These would only be possible to close in 2022, according to Ferraz.

He also acknowledges that the negotiations with Mexico have stalled and are without immediate prospects for progress. Brazil already has a non-comprehensive agreement with the country, which includes about 800 products, and there is support from Brazilian businessmen to seek expansion. Mexicans have always faced this hypothesis with reservations due to competition in agribusiness.

The Brazil-Mexico negotiations, which have already resulted in the modest Economic Complementation Agreement (ACE-53) signed by the two countries in 2002, were held before the decision made by Mercosur partners to only discuss trade agreements together. This decision (No. 32 of 2000) was called into question by Uruguay, which formalized a proposal a few days ago to allow “flexible” agreements in the bloc. For the Uruguayan idea, the countries would continue to sit together to negotiate, but make offers of trade openings at “differentiated speeds”.

According to Ferraz, the Brazilian government agrees with the proposal and will defend this easing of the current rules at the bloc’s meetings in 2021. He recalled that the board of the Foreign Trade Chamber (CAMEX) authorized Brazil to request the opening of trade negotiations with Indonesia and Vietnam also. Mercosur has also already sent a negotiating proposal for the Central American Integration System (a group of countries that includes the Dominican Republic, Guatemala, and Costa Rica), but has not received an answer on whether or not to move forward.

Source: Valor Econômico

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