President Javier Milei on Thursday urged his Mercosur partners to push for greater trade openness within the bloc as he hosted his fellow leaders of the South American bloc in Buenos Aires.
Delivering a typically forceful opening speech, the La Libertad Avanza leader warned that his government would pursue that goal unilaterally if necessary, implying – not for the first time – that an exit from the bloc could be on the cards.
"We will embark on the path of freedom, and we will do so together or alone because Argentina cannot wait," Milei warned, calling for "more freedom" to negotiate.
The head of state has long seen the regional trade bloc as an obstacle to increased trade because of its rules on common negotiations.
"Mercosur, which has become less and less of a market and less and less of a common market. We seek to put an end to what we consider to be destructive inertia," Milei said at the summit, before handing over the rotating pro-tempore presidency of the bloc to Brazil.
"That is why we have proposed that, as a bloc, we move toward a much freer trade and regulatory framework, instead of the iron curtain to which we are currently subjected, in which each country can enjoy greater autonomy to take advantage of its comparative advantages and export potential,” he continued.
"It would be a great joy if, in a few years' time, when Argentina once again has the opportunity to chair this bloc, we find ourselves in the final stretch of achieving this set of objectives.
“But if this is not possible, and the bloc's partners prefer to resist, to persist on a path that has not worked for us, then we will have to insist on making the conditions of our partnership more flexible,” said Milei.
Argentina’s government has repeatedly expressed its desire to move forward with a free-trade agreement with the United States and views Mercosur as an obstacle to achieving that goal.
“We urgently need more trade, more economic activity, more investment and more jobs – and that is why we also urgently need more freedom,” said Milei.
He called on Brazil – one of the bloc’s four members, along with Argentina, Bolivia, Paraguay and Uruguay – to lead such a process during its upcoming leadership.
“If this is not possible, and our partners prefer to resist and persist on a path that has failed us, then we will have to push for a loosening of the conditions that bind us together,” Milei warned.
New markets
All the bloc’s leaders called for Mercosur to expand its markets in the face of US President Donald Trump's global trade war, with Brazil calling for closer ties with dynamic Asian economies.
"It's time for Mercosur to look toward Asia," President Luiz Inácio Lula da Silva said, extolling the potential benefits of deeper relations with Japan, China, South Korea, India, Vietnam and Indonesia.
Lula said that under his leadership, Mercosur would aim to "strengthen inter-bloc trade with external partners" and to implement a landmark free-trade agreement with the European Union.
Brussels in December struck a deal with Mercosur's founding members to create a free-trade zone of around 700 million consumers.
The agreement has been 25 years in the making, but still needs to be ratified by EU member states. It has faced stiff opposition from France, where farmers worry about being undercut by less-regulated Latin American peers, and other agricultural powers.
Uruguayan President Yamandú Orsi said that it was now "time to resume negotiations with key partners such as South Korea and Canada."
Montevideo has for decades sought a relaxation of the bloc's rules, which prevent agreements with other countries without the consent of all partners.
Climate change, the energy transition, combating organised crime and promoting technological development would be Mercosur's main objectives during the next six months, Lula said.
Steps were discussed to make progress on trade agreements with the United Arab Emirates and Canada, as well as update accords with Colombia, Ecuador, Panama and the Dominican Republic, and to advance regional gas integration.
In a joint statement issued at the end of the summit, the Mercosur’s leaders welcomed the approval of a new agreement to "expand the national list of exceptions to the common external tariff of each state party by up to 50 tariff codes," adding that the decision "will allow state parties to adapt to a constantly evolving international environment."
On Wednesday, Mercosur foreign ministers announced a free-trade agreement with the European Free Trade Association, made up of non-EU members Iceland, Liechtenstein, Norway and Switzerland.
Lula praise for regional icons
During his speech at the summit, Brazilian President Luiz Inácio Lula da Silva – an ideological rival of Milei – paid tribute to two Latin American heavyweights who recently died.
Lula declared himself proud to hail from the same part of the world as the late Pope Francis, who died on April 21, and Uruguayan former president José 'Pepe' Mujica, who died on May 13.
"It's a source of pride for me to come from the same corner of the earth as those two exceptional human beings," Lula declared.
Milei's complicated relationships with his regional peers was on full display Thursday. Despite hosting, he held few bilateral meetings.
After an uncomfortable, brief greeting and photo-call with Lula – his ideological foe and rival – Argentina’s leader met privately with Orsi and Panama President José Raúl Mulino, who was invited to attend the summit as a guest.
– TIMES/AFP/NA
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