What can the elections in Brazil mean for Mercosur?

The upcoming elections in Brazil could have an impact on the implementation of the trade agreement between the European Union and the Mercosur countries. It was signed in 2019. At that time it was considered the largest in the world. But it has not yet come into force.

  • The South American community of states forms the fifth largest economy in the world with an annual economic output of 2.2 trillion euros.
  • 260 million people live in the Mercosur trading area
  • The EU exports goods worth 45 billion euros and services worth 23 billion euros to the Mercosur region every year
  • 855,000 jobs in the EU are related to exports to Brazil
  • Over 60,000 EU companies export to Mercosur

Brussels calls for a freeze on deforestation in the Amazon forest

All EU member states must ratify the agreement for it to enter into force. So far this has not happened. Under pressure from Paris, Brussels is now demanding guarantees from Brazil that the Amazon forest will not be destroyed in favor of the expansion of South American grain and cattle producers.

“The Macron government has a legitimate position against the agreement, theoretically because of environmental issues, so additional commitments need to be negotiated,” said Spanish MEP Jordi Cañas.

“But once these environmental and additional commitments are agreed, there is no excuse not to start the ratification process. Because at the moment the agricultural arguments have not been put on the table, not even by France.”

With Bolsonaro, environmental protection and deforestation have increased significantly

Since Jair Bolsonaro’s election, deforestation in Brazil’s rainforests has increased, as have budget cuts for environment-related federal agencies.

“Between 2004 and 2012, deforestation fell by 80%,” says Anthony Pereira, director of the University of Florida’s Kimberly Green Latin American and Caribbean Center. That was long before Bolsonaro came into power, since January 2019 he has been the President of Brazil.

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According to Anthony Pereira, this shows that Brazil has the infrastructure to monitor, prevent and curb deforestation – “if the political will is there.”

The agreement with Mercosur sets environmental targets for all signatories. Many countries in the European Union, for example, are still a long way from their CO2 targets.