THE JOY AND SADNESS OF THE AGREEMENT WITH THE EU

GLOBONEWS presenters, announcing that the EU has approved the agreement with MERCOSUR, jump for joy: now Belgian chocolate will be cheaper. French, Italian, and Spanish wine will be 20% cheaper. Machines, my goodness, cheaper. Life is beautiful, we will now have everything cheaper, better quality products from Europe. What joy. And what fantasy! 

The agreement signed under the Paraguayan presidency of MERCOSUR is indeed important. We have already signed agreements with EFTA, Switzerland, Norway, and others. And Swiss chocolate has not yet dropped in price. And no one remembers that we signed an agreement a few months ago. For the agreement to be valid, there is a process that may take a little longer and that will certainly change the economy of the four MERCOSUR members.

To plan for the future, it is worth analyzing the process and background of the agreement. Europe is in crisis, both politically, at war with Russia, under pressure from the US, but mainly, according to the report by former Italian Prime Minister The Draghi report: A competitiveness strategy for Europe, in a deep crisis of competitiveness. Europe is lagging behind the world and its products and services are not competitive. In fact, ask any child whose products are the most advanced and the answer will be China. Therefore, we have made an agreement with a group of countries that do have a lot of investment in Brazil, but are not leaders in the 21st century.

Under pressure from China, which is literally killing the European automotive industry and competing with Europeans in all fields, plus pressure from the Trump administration with tariffs and leadership in AI, Europe is losing market share. And we are a market for them, the old acquaintance, where their industries are still competitive. In other words, the market that still accepts second-generation machinery, equipment, etc., and luxury products such as wines, cheeses, and chocolates, to which only the top of the social pyramid has access.

The Europeans imposed their draconian conditions for us to make the agreement, both publicly and under the table. We do not know what each country demanded, but it is already public knowledge that the Italian government demanded, in order to join the agreement, that the energy concessionaire in São Paulo, a disaster for the population, have its concession extended within the existing legal framework. Not to mention the demands for our agricultural products.

The fact is that the agreement will be implemented and that the Europeans are ready, even with opposition from the US, to take over this market. We have to prepare for this invasion, which will affect all economic sectors and have social consequences that have not yet been calculated. While the EU has given €45 billion to farmers to compete with ours, we have neither a plan nor the money to face the changes that the agreement will bring. It's that simple.