Key facts
- Mercosur has launched negotiations with Japan for an economic partnership agreement.
- The bloc aims to expand trade ties and integrate value chains.
- Mercosur is also pursuing trade deals with Canada and China.
- A deal with Japan would create a free trade area of 400 million people with a $7 trillion GDP.
The South American trade bloc Mercosur initiated negotiations with Japan on Tuesday for an economic partnership agreement, seeking to broaden its trade relationships following a recent accord with the European Union. The move comes amid global trade shifts influenced by U.S. President Donald Trump's tariffs.
The negotiations were announced during a Mercosur leaders summit in Asuncion, Paraguay, where the bloc's pro tempore presidency transferred from Paraguay to Uruguay. This development follows two prior meetings between Mercosur and Japanese officials in January and March.
Brazilian President Luiz Inacio Lula da Silva and Japanese Prime Minister Sanae Takaichi discussed the launch of these talks, noting progress from previous discussions. The proposed agreement aims to enhance market access for agricultural and non-agricultural goods, foster cooperation, and encourage mutual investment by integrating the economies of both parties.
Mercosur previously finalized a free-trade deal with the EU in January, establishing one of the world's largest free-trade zones, which provisionally took effect on May 1. Additionally, the bloc is engaged in ongoing trade negotiations with Canada, with hopes of concluding them by September or October. President Lula also indicated Mercosur's intention to soon commence negotiations with China, emphasizing the bloc's strategy to connect with dynamic global markets.