Brazilian President urges EU to show 'courage' and sign trade agreement with Mercosur

Brazilian President Luiz Inacio Lula da Silva on Saturday urged the European Union (EU) to show "courage" by signing a trade deal with the South American bloc Mercosur.

Argentina, Brazil, Paraguay and Uruguay had hoped that on Saturday they would finally sign an agreement with the EU to create the world's biggest free trade area. This was also the hope of European Commission (EC) President Ursula von der Leyen and most of the bloc's member states.

However, the agreement was fiercely opposed by farmers, particularly France and Italy, and its signing was postponed until January.

„Without the political will and courage of the leaders, it will be impossible to conclude the negotiations that have been going on for 26 years“, said Lula da Silva in his opening speech at the MERCOSUR summit in Foz do Iguazu.

„In our hands we have the opportunity to send an important message to the world in defence of multilateralism and to reinforce our strategic position in an increasingly competitive global environment“, the Brazilian President told the participants at the Summit.

„Unfortunately, Europe has not yet taken a decision“, – he noted.

Brazil's leftist president announced that he had received a letter from EU leaders in which they said they were confident that the deal would be approved in January.

One source in the European Commission and two diplomats, who asked not to be named, said the agreement is now scheduled to be signed in Paraguay on 12 January. Negotiations on the agreement began in 1999.

But Paraguay's foreign minister, Ruben Ramirez, said that neither he nor his Brazilian counterpart, Mauro Vieira, were aware of any official announcement to that effect.

This agreement would help the European Union export more vehicles, machinery, wines and spirits to South America.

The agreement would also make it easier for South American meat, sugar, rice, honey and soybeans to enter the European market.

Some EU countries, such as Germany and Spain, are welcoming the agreement, which could help boost exports at a time when global trade tensions are running high.

But the proposed deal has raised concerns among farmers, who fear they will be out-competed by a flood of cheaper goods from agricultural giant Brazil and its neighbours.

At least 7,000 farmers with around 1,000 tractors staged a protest against the deal in Brussels' European Quarter on Thursday, as EU leaders were meeting to discuss not only the agreement with Mercosur, but also an initiative to provide funding to Ukraine from frozen Russian funds.

The protesters lit bonfires and fireworks, and threw potatoes, bottles and other objects at police, who responded with tear gas and water cannons.