MercoPress. South Atlantic News Agency

Brazil, Uruguay FMs stay mum after Montevideo meeting: rumors soar

Bustillo and França made no comments in what seemed like a calm-before-the storm situation

Silence prevailed Monday in Montevideo after Uruguay's Foreign Minister Francisco Bustillo Monday welcomed his Brazilian counterpart Carlos França to discuss bilateral issues, particularly a possible 10% reduction of Common External Tariffs among Mercosur members.

After the encounter, neither official was available to the press for comments, thus sparking all sorts of rumors that big announcements could be made shortly.

Bustillo had appeared last week before the Lower House's Committee on International Affairs to share details of the ongoing negotiations with China for a Free Trade Agreement (FTA), although there were no minutes taken during that encounter, due to the nature of “what was was discussed,” explained Deputy Juan Martín Rodríguez later, according to Montevideo's daily El País, which also quoted an opposition Frente Amplio (Broad Front) Congressman who explained it had been Bustillo who had asked for confidentiality.

In this scenario, Uruguay's possible deal with China is believed to have topped the agenda Monday between the two foreign ministers, despit3e all the secrecy around it.

Bustillo had met Argentine Foreign Minister Santiago Cafiero earlier this month in Buenos Aires. Cafiero had explained the encounter had been devised as a step towards relaunching his country's foreign trade policiy after recent controversies with Mercosur partners.

Cafiero and Bustillo are to meet twice before the end of 2021, in November and December to advance on trade negotiations but also on the reopening of internationalk borders in a post-COVID-19 context.

Brazil and Argentina have already agreed to a 10% CET curdown earlier this month when França and Cafiero met in Brasilia and since then it was up to Paraguay and Uruguay to ratifiy the accord. Both Argentina and Uruguay have been demanding modifications in the dynamics and functioning of Mercosur. The government of Alberto Fernández demanded the partial reduction of the Common External Tariff, while Uruguay seeks “flexibility” so that member countries can negotiate one-on-one with other nations or trade blocs.

Last week, Uruguay's President Luis Lacalle Pou ratified his country's stance: “What we have said more than once in bilateral or Mercosur meetings is that at the same time as the lowering of the common external tariff, the bloc should be made more flexible,” he said.