Visit to Argentina: Scholz hopes for an agreement with Mercosur countries

Chancellor Scholz traveled to South America for four days to agree on projects in the areas of energy, raw materials and climate protection. He used his first stop in Argentina to promote the free trade agreement between the EU and the Mercosur countries.

At the start of his trip to Latin America, Chancellor Olaf Scholz in Argentina urgently called for the deadlocked negotiations on the free trade agreement between the EU and the South American federation Mercosur to be restarted.

“Negotiations have gone on long enough,” he said after meeting Argentine President Alberto Ángel in Buenos Aires. “That’s why it’s important that everyone now contributes with a constructive spirit so that we can join hands and find a way to bring the negotiations to a successful conclusion soon.” Scholz was optimistic that an agreement could be reached. “I discovered good spirit and good will here,” he continued.

“We want to get this deal going”

Fernández said he agreed with Brazilian President Luiz Inácio Lula da Silva: “We want to push this agreement and make it work. It would benefit Latin America and especially Mercosur, it would benefit Europe, and it would also strengthen multilateralism in a world that’s about to go bipolar again.”

There have also recently been differences of opinion between the Mercosur countries. Argentina’s left-wing government wants to protect the domestic economy from international competition, while the right-wing governments in Uruguay and Brazil want to remove trade barriers before the change of government there at the turn of the year.

Fernández said at the joint press conference with Scholz that with Lula “we are in a better position” to reach an agreement on the free trade agreement. Lula has ruled Brazil since January 1st.

Negotiations since 1999

The EU has been negotiating a trade agreement with Mercosur (Brazil, Argentina, Paraguay and Uruguay) since 1999. A breakthrough was achieved in 2019, but many are still unclear, especially when it comes to protecting the Amazon rainforest.

The agreement would create a market of more than 700 million people, covering almost 20 percent of the global economy and 31 percent of global goods exports.

Argentina does not supply arms to Ukraine

The Russian war of aggression against Ukraine was also a topic during the exchange in Buenos Aires. President Fernández stressed that his country would not supply arms to Ukraine. “Argentina and Latin America have no thought of sending arms to Ukraine or any other country in a conflict.” However, he could assure Fernández at the joint press conference that he and the chancellor would most like peace to be restored as soon as possible.

Scholz made it clear once again that, from his point of view, Germany is not taking part in the war in Ukraine, despite the arms deliveries. It is a war between Russia and Ukraine. That doesn’t change if Germany provides Ukraine with financial and humanitarian aid or supplies it with weapons. Germany will do everything to ensure that there is no escalation that leads to a war between Russia and NATO countries.

Projects on energy, raw materials and climate protection

With Chancellor Olaf Scholz’s (SPD) trip to South America, the Federal Government wants to give the impetus for closer economic cooperation in areas such as energy, raw materials and climate protection.

Economic State Secretary Franziska Brantner (Greens), who heads the Chancellor’s economic delegation, announced several concrete projects that should be agreed during the visit. “Brazil, Argentina and Chile are partner countries with which we have a lot in common,” she explained.

In Argentina, the first stop on the journey, a joint declaration on energy policy is said to be adopted. In it, Germany and Argentina mutually agree to exchange and support each other in “their respective energy transition and the development of a green hydrogen economy,” explained Brantner’s ministry. In addition, a new platform for exchange between German and Argentinian company founders is to be set up.