Brazil takes over Mercosur presidency; Bolsonaro calls for modernization

RIO DE JANEIRO, BRAZIL – In a speech on Thursday, July 8, Brazil’s President Jair Bolsonaro said Brazil is thirsty for results, intends to launch new negotiations and conclude pending trade agreements The country assumes, until the end of the year, the pro-tempore presidency of Mercosur.

Bolsonaro also said he would work for the reduction of trade tariffs and “eliminate other barriers to the flow of trade among us and with the world.”

“We want and will achieve a more airy and integrated economy with the world, more competitive companies, more productive workers, and more satisfied consumers,” he said, stressing his desire to modernize the trade bloc.

One of the pending agreements is the free trade agreement between Mercosur and the European Union. It has been the target of reservations by European governments because of the country’s problems in environmental management, mainly due to deforestation and burning in the Amazon.

Bolsonaro’s speech took place during a virtual meeting of the Summit of Heads of State of Mercosur and Associated States. Under the presidency of Argentina’s Alberto Fernández, the bloc is showing signs of breaches.

Despite a series of public clashes with the Argentine president, Bolsonaro said he regretted not having met in person with Fernández, whom he thanked for his management at the bloc’s head. He said that, with the rapid vaccination progress, he would be “honored” to receive the heads of state of the bloc at the end of the year.

VETO POWER

The president again criticized the use of the rule of consensus among Mercosur partners to adopt measures by countries, saying it works as a veto instrument that only consolidates the “skepticism” of the bloc. At a meeting of the group’s leaders in March, he had already made a similar complaint about the mechanism.

“The persistence of impasses, the use of the consensus rule as an instrument of veto, and the attachment to archaic visions of defensive bias will have the sole effect of consolidating feelings of skepticism and doubt as to Mercosur’s true dynamizing potential,” he said.

Last month, Economic Minister Paulo Guedes criticized Argentina for opposing Brazil’s trade agreements with other countries and warned that there could be a “severe” problem if the neighboring government did not revise its stances on Mercosur.

“We are not going to leave Mercosur, not at all, but we are not going to be in a Mercosur driven by ideologies,” said Guedes.

RECOVERY

Bolsonaro said he is convinced that Mercosur can and should play a crucial role in the economic recovery of the countries that make up the bloc. He said he wants to overcome the “negative image” of the alliance and modernize the group’s trade agenda during the country’s pro-tempore presidency until the end of the year.

“We cannot let Mercosur continue to be seen as synonymous with inefficiency, wasted opportunities, and trade restrictions,” he said.

The president criticized the bloc’s progress, saying that the semester that has just ended did not meet the expectations and modernization needs.

“We should have presented concrete results in the two themes that have most mobilized our recent efforts: the revision of the common external tariff and the adoption of flexibilities for the negotiation of commercial agreements with external partners,” he enumerated.

The president affirmed that the country would not paralyze the efforts to modernize the Brazilian economy and society and wants the bloc partners to become partners in the same task. He stressed that this is the best way to honor the bloc’s 30th anniversary, celebrated this year.

“In our Presidency, we will continue to work for the original values of the bloc associated with openness and the search for greater and better integration of our economies in regional and international value chains,” he said.