Mercosur and the European Union have given up on reaching a free-trade agreement next week, CNN Brasil reported.
The EU had hoped to finalize a trade deal with the Mercosur countries — Brazil, Uruguay, Paraguay and Argentina — in time for a December 7 summit of South American leaders in Brazil.
But Argentina has notified Brazil, the current president of Mercosur, that it will not be able to make new commitments in the negotiations and that it intends to leave decisions to Javier Milei, an anarcho-capitalist outsider who won Argentina’s presidential election in November, according to the CNN Brasil report. The December 7 summit comes days before Milei’s inauguration.
As a result of Argentina’s decision, a potential round of negotiations set for Rio de Janeiro during the Mercosur meeting was canceled, according to the report. A visit by European Commission President Ursula von der Leyen to the Mercosur gathering was also scrubbed, the report said.
Milei’s victory stunned many in the EU who fear that it spells further trouble for talks on what would be a landmark trade accord. During his presidential campaign, Milei threatened to quit Mercosur.
Von Der Leyen, who was with Brazil’s President Luiz Inácio Lula da Silva on Saturday at the COP28 climate conference in Dubai, maintained hope for an agreement.
“The EU and Mercosur are engaged in intense and constructive discussions with a view to finalizing a political, cooperation and trade agreement,” the European Commission said in a statement. “Substantial progress has been made in the past months,” it said.
“Negotiations will continue in a constructive spirit with an ambition to conclude as swiftly as possible,” the Commission said.
