Mercosur could sign more free trade deals this year

Following the historic free trade deal between Mercosur and the EU, the South American trading bloc could sign more deals this year. 

Mercosur - formed by Argentina, Brazil, Paraguay and Uruguay - finally signed the deal with the EU at the end of June after some two decades of difficult negotiations. 

According to Brazilian officials, Mercosur is in advanced free trade talks with the EFTA bloc - formed by Iceland, Norway, Liechtenstein and Switzerland. 

"With a high degree of certainty we will sign [a deal] later this year," Lucas Ferraz, foreign trade secretary at Brazil’s economy ministry, told state-run news agency Agencia Brasil.

"It's an important deal. Despite being small countries, it's a region that probably has the highest per capita GDP in Europe. The region's GDP is more than one and a half times that of Argentina, something like US$1.1tn," he added. 

Mercosur is also holding free trade talks with Canada, South Korea and Singapore, while negotiations with the US and Japan are at a preliminary stage. 

According to Ferraz, there is a possibility to reach trade deals with all those countries by the end of the tenure of Brazil’s President Jair Bolsonaro (pictured), in December 2022. 

Since taking office in January, the Bolsonaro administration has sought to forge closer ties with developed nations, representing a major shift from the previous administrations under the leftist workers party (PT), which focused its international efforts on developing nations.

Bolsonaro’s vision for Mercosur is shared by his Argentine counterpart, conservative and business-friendly President Mauricio Macri.

However, Macri faces a very difficult election in October due to Argentina's economic woes and the ambitious plans for Mercosur could suffer a blow if he is not reelected.