Mercosur closes agreement with EFTA, European bloc of high -income countries

Mercosur and the European Free Trade Association (EFTA)-which brings together Switzerland, Norway, Liechtenstein and Iceland-announced, on Wednesday (2), during the 66th Mercosur Summit, in Buenos Aires, the conclusion of negotiations of a free trade agreement.

“I am confident that by the end of this year we will sign agreements with the European Union (EU) and EFTA, creating one of the largest free trade areas in the world,” said President Luiz Inacio Lula da Silva, during the summit on Thursday (3), when he assumed the temporary presidency of the block for the next six months.

The pact was also celebrated by the vice president, Geraldo Alckmin. He stressed that this set of European countries forms a “high -income market, which will ensure easy access to 100% of our industrial exports. It was eight years of hard work, but the result shows that dialogue is the way to encourage our economy, generating employment and income”.

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With the negotiation phase finished, Mercosur and EFTA start working for the signing of the pact, scheduled for this year. The entry into force may occur bilaterally, and at least one country of each block completes its internal procedures.

The deal involves a free trade zone composed of almost 300 million people and a total GDP of more than $ 4.3 trillion. South American countries will have access to an estimated $ 1.4 trillion market.

According to Itamaraty, the results obtained “demonstrate that Mercosur is a central and effective platform in the global insertion of our economies. We are able to achieve these results when we work together as a block.”

According to the government, the entry of Brazilian products in the EFTA markets will reach almost 99% of the exported value, covering the agricultural and industrial segments. It was also agreed that the European Association will eliminate 100% of import rates from the industrial and fishing sectors.

Environmental advances

The agreement goes beyond the commercial issue and also brings advances in the environmental field. “For the first time in a commercial agreement negotiated by Brazil, there are clear obligations on the use of clean electric matrix in the provision of services,” said the Ministry of Foreign Affairs.

International digital service providers, for example, will only benefit from the agreement if your country’s electrical matrix uses at least 67% clean energy. In addition, commitments to the Paris Agreement and the Convention on Biological Diversity, as well as the promotion of responsible productive practices and sustainable agriculture, were reinforced.

Efta e ue

Government calculations indicate that last year alone, Brazil exported US $ 3.1 billion and imported US $ 4.1 billion in goods in this group of countries.

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From now on, considering Mercosur agreements with EFTA, Singapore (signed in 2023) and with the European Union (finalized in 2024), the Brazilian trade current will increase by 2.5 times from US $ 73.1 billion to $ 184.5 billion.

In the case of the agreement with the EU, the negotiations were completed in December 2024. The document is in the legal revision and translation before signing by the parties. Lula has been acting directly on the joints to enable the pact, including with the French President Emmanuel Macron, who has greater resistance to the agreement.