Countries are optimistic for formalization of an agreement that will benefit companies

CCBC actively monitors the progress of negotiations for a trade agreement between Mercosur and Canada. The parties involved in it have been optimistically observing the changes in the foreign relations of Brazil – the largest and most influential South American economy – that exchanges South-South politics for the focus on developed countries. The rapprochement with the US is positive, according to experts the Chamber has heard of, as it causes Brazil and its neighbors to look to North America.

“There is enthusiasm in the face of the prospect of greater openness of the Brazilian economy to international markets”, said Elise Racicot, Consul and Chief of the Commercial Sector of the Consulate General of Canada in São Paulo, in the 5th edition of Comex Chat, held at CCBC headquarters.

Mercosur is not alone. The desire to formalize the commitment also exists in Canada, where there is great interest in diversifying the agenda of foreign trade. In addition to the agreement signed with the European Union two years ago, the country last year signed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, involving nations like Australia, Japan, Chile, Malaysia and Singapore. The goal of Canadians, Elise revealed, is to expand their trade beyond the US by 50% by 2025.

“The negotiation with Mercosur is going well. If you follow our ambassador on social media, for example, you will see that he is committed and has been meeting with different parties, such as Apex, CNI and CNPQ”, the Consul told an audience of more than 50 CCBC associates who attended the Comex Chat.

To meet the demands of the Brazilian businessman

Elise points out that an agreement in itself does not change the trade relationship between countries, but creates an environment to accelerate these relations. Strengthening cultural and educational ties between peoples is a good way and at least in the case of Brazil there are admirable numbers. For more than ten years, Canada has been the favorite destination of Brazilians who study abroad for more than six months. But the participation of the business community and the entities that represent them must also be active.

Luana de Almeida, international trade and investment consultant at Sidera Consult, an associate of CCBC, who spoke with the Consul at the Comex Chat, recalled that Canada held public consultations with civil society and discussions on the agreement. The Foreign Trade Secretariat also opened a consultation, clarifying doubts and listening to the needs of companies. “We need the engagement of Brazilian entrepreneurs. It requires that their demands be publicized and reach the government”, said Luana.

If companies are able to take advantage of the benefits of the agreement, there is enormous potential for increased productivity, consumption, technological development, industrial stimulation and job creation. One of the expectations is that there are advantages also for small and medium companies. Among the various industries that may benefit from are automobiles, chemicals, metallurgy, agriculture, livestock and information technology. Also included in the list are more than 300 products that may have their trade facilitated.

Is there a date for signing the agreement?

Since March 2018, five negotiating rounds have been held for the Mercosur-Canada agreement, the most recent being last month in Ottawa. The next one is scheduled for the week of May 23 to 31, in Brasília. So far there has been considerable progress in the areas of environment, trade, services and regulatory practices.

Mercosur has been negotiating an agreement with the European Union for almost 20 years. Experts, however, agreed that a commitment to Canada should come out long before that – both for the moment the countries are going through and the favorable scenario, and for the ease that Mercosur has to negotiate with only one party, which is very different from when negotiating with the European bloc. “Many people would like to have good news to communicate at the Mercosur Summit in June, but it’s too soon to say what’s going to happen”, says Elise.

Meanwhile, CCBC continues its agenda of discussions on the future agreement. In addition to the 5th edition of the Comex Chat held in February, the 2nd Brazil-Canada Foreign Trade Meeting,  held on March 22, had an exclusive panel to discuss the Mercosur-Canada agreement.

Participating in this panel were Bonny Berger, Counselor for Trade and Economic Affairs, Canadian Embassy; Carolina Matos – Policy and Industry Analyst at the Brazilian National Confederation of Industry (CNI); Carolina Monteiro de Carvalho – Partner at Mundie Advogados; and again Luana Almeida – Consultant of International Trade and Investments – Sidera Consult.