Brazil assures that it will not allow changes to Mercosur, after Uruguay’s interest in an FTA with China

Brazil wants to maintain the founding treaty of the Mercosur without changes and the bloc’s common external tariff, said Tuesday Celso Amorim, senior adviser to Brazilian President Luiz Inacio Lula da Silva on international issues.

In a press conference at the end of the summit of the Community of Latin American and Caribbean States (CELAC) that was held in Buenos Aires, Amorim was emphatic in his objection to the Uruguayan decision to negotiate bilateral trade agreements without the authorization of the CELAC partners. Mercosur, a bloc founded in 1991 by Argentina, Brazil, Paraguay and Uruguay.

“Uruguay in many aspects is an example of civility in Latin America, and in many things they are very advanced, but we believe that Mercosur should be preserved“, emphasized Amorim, one day before an official visit by Lula to his counterpart Luis Lacalle Pou in Montevideo.

“Let’s talk. Within the idea of ​​preservation, there is the common external tariff. That is not something that is not required by Brazil or Argentina, it is the first article of the treaty of asuncion“, affirmed Amorim, who was Lula’s chancellor during his first two presidencies (2003-2010).

This article of the constitutive text of Mercosur enshrines “the establishment of a common external tariff and the adoption of a common commercial policy in relation to third States or groups of States, and the coordination of positions in regional or international economic, commercial forums”.

Mercosur has a common external tariff with multiple “perforations” or exceptions. Argentina and Brazil lowered it in 2021 in an agreement between their two governments.

The article also proposes the elimination of “non-tariff restrictions on the movement of goods”, a point that Uruguay indicates is not always fulfilled within the bloc.

“We want to preserve the Treaty of Asunción in the way it is written, but we recognize that smaller countries need some support, in some way,” said Amorim, who stated that the partners can “buy industrialized products from Uruguay or encourage Uruguay to participate of the productive chain” in the automotive sector, among other measures.

But Uruguay’s position is very different.

tension grows

President Lacalle Pou recalled at a press conference in Buenos Aires that “the definition” of opening his country’s trade to third countries was adopted in Uruguay several governments ago.

His resolved to advance in an FTA with China, which publicly expressed its interest in negotiating with Uruguay. The two countries are advancing in negotiations after carrying out a feasibility study, and the situation is tense for Argentina, Brazil and Paraguay, which even threatened Montevideo with legal and commercial measures.

Lacalle Pou, who assures that he has no objection to the other partners participating in an agreement with the Asian giant, pointed out that “Mercosur is the fifth most protectionist region on the planet“.

The Uruguayan president reiterated that his country is not “rupturist.” “We never said that we are going to abandon Mercosur”he insisted.

Uruguay also applied to join the Trans-Pacific Agreement.

The partners also disagree on the re-entry of Venezuela to Mercosur, promoted by Brazil and Argentina.

Caracas was suspended from the South American bloc in 2017, pursuant to the Ushuaia Protocol, until “the full restoration of democratic order is verified” in the Caribbean country.

Lula will have lunch with Lacalle Pou in Montevideo on Wednesday. Amorim is part of the Brazilian president’s delegation on his first international trip.

The diplomat maintained that the meeting will be “a first conversation” with the Uruguayan government.