Tension in Mercosur: Uruguay steps on the accelerator to advance agreement with China, while Paraguay moves closer to Chile

After Brazil warns Argentina that if they feel uncomfortable they can withdraw from Mercosur, Uruguay started work on Tuesday before negotiating a free trade agreement (FTA) with China.

At the same time, the Paraguayan President, Mario Abdo Benítez, and its Chilean counterpart, Sebastien Piñera, met in Asunción to advance a bilateral economic agreement and a regional strategic connectivity project. In Buenos Aires, the government of Alberto Fernandez They ratified that the objective continues to be the unity of the regional bloc.

The first step in an agreement between Uruguay and China

Uruguayan Foreign Minister Francisco Bustillo on Tuesday announced the formation of a negotiating team to begin negotiations with Beijing.

After meeting the president, Luis Lacalle Pou, Bustillo said that Ambassador Fernando López Fabregat and economist Juan Labraga have been appointed coordinator and alternate coordinator of the task force, respectively.

This negotiating team of the NAFTA feasibility study, which is supervised by the Chancellor himself and the Minister of Economy and Finance, Azucena Arbeleche, started “working a few days ago,” the minister said.

The feasibility study identifies “areas and problems” and provides “the context in which to negotiate” with the Chinese government, Bustillo said.

According to the foreign minister, Uruguay and China have agreed advance the feasibility study before the end of the year to begin the second stage, which would be “that of the negotiations proper”.

Uruguay wants to “go to the world” with all Mercosur partners

On September 7, Lacalle Pou made public that Uruguay and China intend to move forward on an agreement of these characteristics, despite Mercosur’s position not to allow countries to negotiate agreements outside the bloc.

“This government has expressed its intention to move forward towards the world, go out into the world with all Mercosur partners, but at the same time and was explicitly done, if it was not possible to move forward together, Uruguay would try to do so“said the then Uruguayan president.

China is the main market for Uruguayan exports, accounting for 26.21% of the volume invoiced in August, according to the latest monthly foreign trade report from the Union of Uruguayan Exporters.

Chile and Paraguay to negotiate economic agreement

In addition to Uruguay, another Mercosur partner, Paraguay, has announced its willingness to negotiate an agreement with Chile, a state associated with the regional pact.

Abdo Benítez and Piñera closed an official meeting on Tuesday during which they underlined the will of their governments to push forward an economic agreement oriented towards the signing of a free trade agreement, in addition to strengthening its relationship with regional strategic connectivity projects.

The Chilean president invited his Paraguayan counterpart to go to Chile to sign the economic implementation agreement that could take place this year, in view of the same treaty.

Abdo Benítez said his government hoped to move forward “shortly in signing the complementary economic agreement” between the two governments.

“And that as a result of this agreement, we can achieve the signing of a free trade agreement between the Republic of Paraguay and Chile to further facilitate integration and trade processes between the two countries,” said he declared.

Mercosur: Argentina wants to preserve the unity of the bloc

Amid this complex regional situation, President Alberto Fernández on Tuesday led a meeting with his cabinet officials to discuss the Mercosur issue with the idea of ​​”preserve the unity of the regional bloc“As a ‘state policy’.

This is, according to official sources cited by Telam, a “strategic body for integration and economic development”.

The meeting took place in the President’s office at Casa Rosada with the participation of Foreign Minister Santiago Cafiero; the Ministers of Economy, Martín Guzmán, and of Productive Development, Matías Kulfas; the Secretary for International Economic Relations of the Ministry of Foreign Affairs, Cecilia Todesca; and the Secretary for Industry and Knowledge Economy, Ariel Schale.