Lula urges meeting of EU-Mercosur leaders over trade deal fate

Brazil’s president Luiz Inácio Lula da Silva is asking for a meeting of leaders from the European Union and Mercosur to decide on a trade deal this year, during his presidency at the South American bloc. 

“Brazil wants and needs the deal but we have to be treated on equal terms,” he said at a press briefing on Monday. “It’s time to decide: yes or no.”

The EU and the Mercosur countries — Argentina, Brazil, Uruguay and Paraguay — have been in talks to try to clinch a trade accord for more than 20 years. An agreement was announced in 2019 but was never implemented amid new demands, including a European so-called side letter with new environmental terms.

Lula pushed for completing the deal in meetings on the sidelines of the Group of 20 summit in New Delhi over the weekend, complaining to French President Emmanuel Macron, European Commission President Ursula Von der Leyen and European Council President Charles Michel about the side letter.

Lula called the document, with a list of environmental commitments, “offensive.” France’s demands for stronger anti-deforestation provisions, are threating the finalization of the trade deal. 

“The terms are unacceptable, Brazil does not accept any sort of sanctions,” Lula said. Since Lula took office in January, Brazil reduced deforestation in the Amazon rainforest by about 40%.

An EU official characterized the meeting with von der Leyen as positive, saying they had agreed on a process and timeline forward. The official declined to provide further details.

The agreement, if concluded, could provide another boost to the agribusiness industry, which drives Brazil’s status the world’s leading exporter of coffee, soybeans, beef and other products.