Brazilian President Jair Bolsonaro and his Argentine counterpart Mauricio Macri stressed on Wednesday (16.1.2019) the need to "modernize" Mercosur and close a trade agreement with the European Union.
In the first meeting between the two leaders since Bolsonaro took office on January 1, both presidents issued a joint statement in which they stressed the urgency of "perfecting" Mercosur and "changing the work agenda."
"We agree on the need to improve Mercosur, changing the work agenda, valuing the initial proposal of trade openness," Bolsonaro first explained, who affirmed that "there are no taboos" in the bilateral relationship between Brazil and Argentina and what motivates them is "obtaining concrete results."
With Bolsonaro's rise to power, the future of this country in Mercosur, which has functioned as a trade alliance in the region since 1991 and was of great importance to previous centre-left governments, has been called into question.
After Bolsonaro won the second round of elections on October 28, Paulo Guedés, the current Minister of Economy, confessed that Mercosur was not a priority for the government. The official later retracted his statement, but at the end of November, Tereza Cristina Correa da Costa, Minister of Agriculture, said that the Latin American giant would leave the group “if the conditions” were “unfavorable.”
Along the same lines as Bolsonaro, Macri stressed the need to "modify" Mercosur in order to "advance in a space of integration that adapts to the challenges of the 21st century" as well as to take advantage of "the opportunities that the world offers."
"I told the president that trade is an instrument that drives development, which is why it is essential to speed up and complete the negotiations underway," said Macri, who said that negotiations for a trade agreement with the European Union (EU) have required "a lot of effort."
Mercosur and the EU have been negotiating for 20 years to reach a trade agreement, which has not yet seen the light of day.
Brazilian government sources announced before the meeting that the meeting would be preliminary, since any negotiation on Mercosur must also involve Uruguay and Paraguay.
Business relationships
For the Argentine president, who faces a decisive year and hopes to be re-elected in October, trade relations with his main trading partner are essential.
Argentina closed 2018 with inflation of 47,6%, the second highest in Latin America after Venezuela, while in Brazil inflation remained under control in 2018, at 3,75%.
«Brazil is our first trading partner and we are the second destination for its industrial products. "We have major joint developments in nuclear, space, aeronautics and scientific and technological cooperation," Macri said.
Bolsonaro praised Macri's "efforts" to straighten out Argentina's "battered" economy. Brazil "greatly appreciates the relationship and friendships and cooperation," said the former reserve captain, who also stressed the "need to revitalize" trade exchanges between the two countries.
Extradition agreement
The leaders signed a Extradition Treaty between Argentina and Brazil, to "speed up" communication between the two countries and "fight against imputinity," the text reads.
Source: Ministry of Foreign Affairs of Brazil
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