The free-trade agreement between the European Union and Mercosur — the trade alliance grouping Brazil, Argentina, Paraguay, and Uruguay — is “a good and well-balanced deal that shouldn’t be reopened for negotiations,” Marcos Troyjo, a career diplomat who recently served as president of the New Development Bank (also known as the BRICS bank), said on Wednesday.
His remarks were made during the Brazil Summit in New York City, an event hosted by the Financial Times and of which The Brazilian Report is a supporting partner.
Mr. Troyjo, who served as deputy minister of foreign trade and international affairs during the former Jair Bolsonaro administration and participated in the negotiations around the deal, said its framework “is about standards [for the role of government in public procurement, environmental rules, among other things] and not import quotas.”
He believes the agreement is as fine-tuned as it will ever be — and defended that Brazil, by far Mercosur’s biggest economy, must fight tooth and nail to get it over the hump. “This deal will make Brazil less dependent on Asian exports,” Mr. Troyjo said. Asia accounted for 42 percent of Brazilian exports in 2022, per data from the Trade and Development Ministry.
Mr. Troyjo had served as BRICS bank head until earlier this year, when he was replaced by former Brazilian President Dilma Rousseff.
Mr. Troyjo’s remarks are aligned with the viewpoint defended by Brazilian Report columnist Oliver Stuenkel, who this weekend argued that the free-trade deal would increase both Mercosur’s and the EU’s strategic autonomy as the world is headed toward a new Cold War between the U.S. and China, the two global superpowers. Failure to ratify the deal, however, would be a lose-lose situation.
After two decades of negotiations, the EU and Mercosur reached an agreement in 2019, but ratification has proven to be elusive, in no small part due to pushback from agricultural lobbies in multiple European countries (none more vociferous than in France).
During his 2022 re-election campaign, French President Emmanuel Macron expressed concerns over Brazilian farmers’ environmental standards. “We refused to allow this issue to advance because there was no commitment to the Paris Climate Agreements, no respect for biodiversity, and we have fought against imported deforestation,” Mr. Macron said during a runoff debate last year.
“Farmers in Europe want more protectionism, but European manufacturers need to expand their markets. It will come down to how this equation plays out,” Mr. Troyjo said. In other words: which EU lobbies will prevail, those pushing farmers’ interests or industrialists’?
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