MercoPress. South Atlantic News Agency

Lula pledges to defend SMEs in EU-Mercosur deal

President Lula will not give in, even if it means taking a little longer to conclude the Mercosur-EU deal

Regarding the European Union-Mercosur trade deal, Brazilian President Luiz Inácio Lula da Silva insisted that his government's purchases were “non-negotiable” and promised not to give in because it would entail killing ”the possibility of growth of small and medium-sized companies (SMEs).“ The Workers' Party leader also admitted that discrepancies on this point might delay the agreement ”a little longer.”

“In the same way that France fervently defends its agricultural products and wine, we are going to defend small industry in this negotiation,” said Lula in a speech at the Federation of Industries of Sao Paulo (FIESP).

Since Lula returned to office on Jan. 1, the European Union and Mercosur resumed negotiations to close the trade agreement between the two blocs, which was concluded at a technical level in 2019, after two decades of negotiations.

As per the accord's wording, Mercosur countries (Argentina, Brazil, Paraguay, and Uruguay) would treat European companies as domestic ones in tenders. On the other hand, Europe's environmental requirements open the possibility of sanctions against South American trade partners.

Also on the diplomatic front, Lula said Thursday that he had had a telephone conversation with his Chinese colleague Xi Jinping to discuss BRICS (the economic bloc made up of Brazil, Russia, India, China, and South Africa), and also the situation of the war in Ukraine.

“Yesterday [24] I talked by phone with the President of China, Xi Jinping. We talked about the global situation, the need for peace in Ukraine, and the participation of our countries in the BRICS summit in August. And about our strategic partnership on a bilateral level,” Lula wrote on a social network.

The conversation comes just over a month after the bilateral meeting between the two presidents in Beijing, and days after Lula returned from a trip to Japan, where he participated in the external engagement segment of the G7 Summit, a group made up of the seven most industrialized countries in the world (Germany, Canada, the United States, France, Italy, Japan, and the United Kingdom) in Hiroshima, between the May 19 and 21, during which the South American leader held 11 key one-on-one meetings.

Besides environmental issues and food security, which were central during the summit, the subject that dominated the debate tables was the conflict between Russia and Ukraine. But despite various arrangements, Lula never got to get together with Ukrainian President Volodymyr Zelensky.

Read also: Lula says Zelensky stood him up