Sergio Ferrari*, contributor to Prensa Latina
Mercosur integrates Argentina, Brazil, Paraguay and Uruguay as contracting states. Venezuela is temporarily suspended; Bolivia applied for membership and is an associated nation along with six other countries in the subcontinent: Colombia, Chile, Ecuador, Guyana, Peru and Suriname.
During his visit to Paris to attend the summit for a new global financial deal, Brazilian President Luiz Inácio Lula da Silva updated his criticism of the European Union’s (EU) new demands for the agreement, which he described as a “threat”. At the same time, he called for a profound change in the international financial institutions created by Bretton Woods after World War II, which “no longer work”. As an example of this dysfunction, he cited the International Monetary Fund’s loan to Argentina, agreed during the administration of former President Mauricio Macri.
To reinforce this continental vision, the outcome document of the recent Sao Paulo Forum meeting, held June 29-July 2 in Brasilia, denounces “Free trade agreements and the legal architecture they create that empower transnational corporations to the detriment of our sovereignty “. The same document “lauds President Lula’s stance of opposing environmental sanctions and other protectionist mechanisms, which are emerging in the debates over the Mercosur-EU deal.”
threats
During his visit to France, the South American President told his French counterparts Emmanuel Macron and Germany’s Olaf Scholz that “trade agreements need to be fairer”. He expressed his interest in a treaty with the European Union, but said it was not possible at the moment. The additional letter the EU sent to Mercosur presidents “does not allow for an agreement” and refers to an annex that provides for sanctions in the event of non-compliance with new environmental targets and other commitments.
Lula reiterated that it was inconceivable that a strategic merger would be promoted and that there was an additional letter that posed a threat to some of the signatory partners. The President had already dismissed these new demands during the visit of Ursula von der Leyen, President of the European Commission, to Brasilia in the second week of June, when she was in Brazil embarking on a tour of Latin America.
After 20 years, negotiations between Mercosur and the EU were concluded in June 2019, but the treaty has not been ratified by the parliaments of the participating countries, a prerequisite for its application. This is the most important trade agreement for the European Union as it involves the integration of a market of 800 million people; represents nearly a quarter of global GDP and has more than $100 billion worth of bilateral trade in goods and services
In March this year, the EU presented new terms to Mercosur, which Lula rejected, while South American countries rejected possible sanctions if they failed to meet, for example, the environmental targets for bilateral trade set by Brussels. The questions from the Mercosur countries are about the regulations set out unilaterally in the European Green Pact adopted in 2020. Including one that bans the purchase of products that come from deforestation-free areas, which would affect many exports from South American countries.
They cry out their dissatisfaction
Negotiations on an “outdated, neocolonial and unbalanced” trade liberalization deal must end, four Brazilian and French civil society actors said in a joint statement released hours before Lula began his official agenda in France.
At a time when the European Commission (EC) is expending great energy to finalize the agreement as soon as possible, the national collective Stop Mercosur, the Brazilian Front against the EU-Mercosur Agreement, the French coalition “Solidarité Brésil” and the Brazilian Network for the Integration of Peoples (Rebrip) called on the EC to end the pressure and threats it is making against Mercosur countries. And they are demanding that all parties involved end these negotiations.
The four platforms thus expressed the previous position of 170 social organizations, NGOs, trade unions and farmers’ associations from around 30 Latin American and European countries, which had already defined a crucial framework for this trade agreement in May and proposed various alternatives and viable proposals. The 170 organizations called their statement: “Solidarity, equality, cooperation and sustainable trade: an alternative to the EU-Mercosur trade liberalization agreement”. Signatories include Vía Campesina, Greenpeace and Friends of the Earth; CADTM and ATTAC from France; the CGT, the Comisiones Obreras and the Spanish Inter-Trade Union Confederation; KoBra and the German Ecumenical Office for Peace and Justice; the Landless Workers Movement (MST) and the Earth and Fire Articulation of Brazil; the Italian Sinistra and the TNI of the Netherlands to name a few (https://s2bnetwork.org/uemercosuralternativa/).
The four Brazilian and French platforms that adopt this document from the 170 signatories warn that the current content of the Mercosur-EU agreement, if ratified, would exacerbate “the existing economic and socio-environmental asymmetries between the two blocs”. Furthermore, it would increase the primary specialization of Mercosur countries’ economies to the detriment of economic diversification (https://www.bilaterals.org/?mettre-fin-aux-negociations-d-un).
According to the four platforms, it is the industrial sectors, peasant and small-scale agriculture, small and medium-sized enterprises in the Mercosur countries – particularly due to the opening of public procurement markets – and the middle and disadvantaged social classes of South American countries “that benefit from such an unbalanced agreement nothing to gain.”
They claim the same will benefit producers and exporters of agricultural, mining and energy commodities, European transnationals making pharmaceutical, agrochemical and automotive products, as well as those interested in public procurement and the privatization of services of human rights abuses and horrific socio-environmental impacts on indigenous peoples, local populations, lands, forests, ecosystems and biodiversity.
The Europe below is also penalized
As for the impact on Europe, such a deal will mean higher meat import quotas with lower tariffs, which will mean “European farmers will face more competition, which will lead to lower prices and therefore intensify the most concentrated European agricultural system .” And they stress that even in the Old World, the biggest beneficiaries will be the European multinationals looking to win new public contracts and/or export pesticides now banned in Europe, as well as cars, their technology and type of combustion are already obsolete.
The four platforms complete the bleak picture they envision if the EU-Mercosur deal were finally adopted: “The impunity for human rights and human rights abuses committed by large transnational corporations will only increase.” Although the deal plans to abolish more than 90 percent of tariffs in trade between the two zones, the companies in the European automotive, chemical and pharmaceutical sectors and the agricultural export sector of the Mercosur countries resent monoculture, those who will benefit the most”.
Likewise, they claim that if this treaty were signed, the economic asymmetries between the EU and the Mercosur countries would deepen, according to a neo-colonial model of resource hoarding to the detriment of the diversity, autonomy and resilience of local and regional economies of integration between peoples. And they argue: “Where trade rules should be reviewed and limited in the name of 21st century exigencies, this draft agreement follows strictly the opposite logic: climate policies, for example, are accepted provided they do not conflict with intended rules on international trade.” increase with goods and services.
In concluding their analysis, Stop Mercosur, the Brazilian front against the agreement, the French coalition “Solidarité Brésil” and the Brazilian network for the integration of peoples (Rebrip) reiterate that this need not be the case because “on both sides…” In the Atlantic, we have much more to offer in terms of international cooperation and solidarity than a neoliberal trade deal.
The signatories share the need to strengthen relations between the countries of the European Union and those of Mercosur, and more broadly between the peoples of Europe and Latin America. However, this cannot be based solely on trade in goods and services transported across the Atlantic. And they conclude: “On the contrary, we call on our governments to define and refocus their geopolitical and commercial relations on the basis of new principles as recently proposed by 170 social organizations in order to ensure a good life for all guarantee rather than ensure it.” Benefits for a select few.
The cards are on the table. Now it’s up to rulers on both sides of the Atlantic to eye each other with suspicion. Delicate game in front of an audience that doesn’t accept cheating and is aware that its own survival depends to a large extent on the result.
rmh/sf
*Argentinian journalist living in Switzerland
(taken from selected companies)