MercoPress. South Atlantic News Agency

Brazil and Canada to resume talks for FTA with Mercosur

Brasilia and Ottawa issued a joint statement celebrating the initiative

Brazilian authorities, exercising the pro tempore presidency of the Southern Common Market (Mercosur), and representatives from Canada are to resume talks about a Free Trade Agreement (FTA) that was initiated in 2018 but suspended during the Covid-19 pandemic.

According to Brazilian Foreign Minister Mauro Vieira and his Canadian counterpart, Maninder Sidhu, the move is a timely and strategic step to increase the competitiveness of their respective productive sectors.

Sidhu stated that in a time when global trade rules are under threat, it was necessary to stand with strong partners. He mentioned that an agreement with Mercosur would provide the bloc with preferential access to Canada's open and dynamic economy.

Itamaraty said in a statement that alternatives to increase bilateral trade, as well as to promote mutual investment and strengthen cooperation in the areas of energy and minerals, will also be discussed.

Sidhu's visit comes at a time when both Canada and Brazil are seeking ways out of the tariff war unleashed by US President Donald Trump. Brazilian exports are currently subject to a 50% tariff, imposed in response to the criminal proceedings related to an alleged coup attempt involving former President Jair Bolsonaro. In light of this, the Brazilian government is actively seeking alternative markets to offset the decline in trade with the United States.

Canada remains a key economic partner for Brazil. In 2024, bilateral trade between the two countries totaled US$9.1 billion, with Brazil enjoying a significant surplus—$6.3 billion of that amount came from Brazilian exports.

In addition to strengthening bilateral ties, Canada has recently signaled its interest in reviving negotiations for a trade agreement with Mercosur, the regional bloc comprising Argentina, Brazil, Uruguay, and Paraguay, with Bolivia currently undergoing the accession process.

In a joint statement, Brasilia and Ottawa said that, “as a timely step toward greater economic diversification,” the chief negotiators of Canada and the Mercosur countries should meet in October to restart talks on a free trade agreement.

“The resumption of trade negotiations between Mercosur and Canada is a clear sign of our shared commitment to deepening mutually beneficial economic ties and opening up new and relevant opportunities,” Itamaraty's document further noted.