25 Feb 2013

In Search of a Feasible EU-Mercosul Free Trade Agreement

Renato G. Flôres Jr

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This paper aims at identifying ways to pursue the EU–Mercosul negotiations leading to a free trade agreement (FTA). After reviewing their already long history, it outlines a basic framework, in goods, services and other themes, judged possible. The main point is that, given the prevailing conditions on both sides, an agreement to be signed within a reasonable time must be modest, i.e. along the described lines. It then clearly sets up the decisions confronting the negotiators: either to pursue the modest, feasible option or to terminate negotiations under the FTA heading. The latter, however, does not imply an end to the dialogue. Many actions and measures may be taken – which are easier to discuss and fix – that could pave the way for, in due time, a closer-to-ideal FTA to be considered again. These are the subjects of a last section.

Renato G. Flôres Jr is Professor, Graduate School of Economics/EPGE, and Head, International Intelligence Unit/IIU, both at Fundação Getulio Vargas, Rio de Janeiro.