MEXICO CITY, July 18 — Brazil’s President Luiz Inacio Lula da Silva said yesterday that a trade agreement between the European Union and the South American economic bloc Mercosur will be ratified by the end of 2023, ending more than 20 years of negotiations, reported Anadolu.

Lula made the remarks during his speech at the opening of the two-day EU-Celac summit in Belgium, which was also attended by European Commission President Ursula von der Leyen, Spanish President Pedro Sanchez, and the presidents of the Inter-American Development Bank (IDB) and the Development Bank of Latin America and the Caribbean (CAF).

Underscoring the relevance of the EU as a commercial partner, Lula announced that the much-coveted deal would be ratified by the end of the year.

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“The European Union is Brazil’s second-largest trading partner. Our trade flow could surpass the US$100 billion mark this year,” he said.

“A balanced agreement between Mercosur and the European Union, which we intend to conclude this year, will open new horizons. We want an agreement that preserves the parties’ ability to respond to present and future challenges,” he added.

Both sides had wavered over the free trade agreement since 1992, officially ending negotiations in 2019 during the first year in power of former Brazilian President Jair Bolsonaro. The right-wing leader’s policies on the Amazon pushed the European bloc into hesitance, which postponed the deal’s ratification.

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Progress on the trade pact was expected to continue with Lula’s return to the presidency this year.

However, the Brazilian leader slammed the agreement following a bill approved by the European Parliament in September 2022 that prohibited importing commodities linked to deforestation with the option to sanction trading partners that did not comply.

The new legal framework now embedded in the trade agreement was condemned by Lula, who criticised the initiative for limiting Brazil’s agricultural and industrial exports.

But the announcement made by Lula during the summit between Celac and the EU confirms the end of tensions between the two blocs.

“We will demonstrate, as we have done in the past, that it is possible to produce and grow sustainably and efficiently,” he said in Brussels.

During the summit, the European Commission announced an investment of over €45 billion (RM229 billion) in the Latin American and Caribbean region.

According to a press release by CAF, the investment will focus on clean hydrogen, critical raw materials, telecommunications, and the development of advanced mRNA vaccines. — Bernama-Anadolu