Mercosur and UAE begin free trade talks

From July 2 to 4, representatives from Mercosur member countries and the UAE met in Asunción to launch negotiations towards a free trade agreement encompassing their respective regions.

During the meeting, the countries agreed on the terms of reference for the negotiations and held the first round of discussions on a potential new free trade agreement. These terms of reference lay the foundation for the talks, covering topics such as goods, services, rules of origin, technical barriers, sanitary and phytosanitary measures and intellectual property.

The negotiations aim to eliminate or reduce customs tariffs and other trade barriers while facilitating the flow of investments and services among the participants.

In 2023, the UAE ranked as the 28^th largest destination for Brazilian products. By the first half of 2024, it surged to the 13^th position, fueled by a 74% increase in Brazilian exports to the UAE from January to June compared with the same period in 2023.

Tatiana Prazeres, secretary of Foreign Trade at the Ministry of Development, Industry, Commerce and Services (Secretaria de Comércio Exterior, Ministério do Desenvolvimento, Indústria, Comércio e Serviços/SECEX/MDIC), noted that the Mercosur-AE trade negotiations are in the preliminary stage. "A prospective trade agreement aims to enhance trade and investment flows, foster economic growth and generate employment opportunities in both economies," Prazeres concluded.

Mercosur’s negotiations with the UAE are aligned with the Brazilian government's strategy of expand the South American bloc's network of trade agreements to create additional opportunities for Brazilian exporters. A public consultation conducted by SECEX in 2023 identified the interests and concerns of Brazilian firms regarding the UAE, providing a foundation for MDIC's efforts in this negotiation.