Latin Finance | 11 March 2026
Mercosur wants to sign two more FTAs this year
by Lucien Chauvin and Thierry Ogier
South America’s Mercosur trading bloc, which in January signed an historic free trade deal with the European Union, hopes to finalize more free trade agreements in the coming months, bucking the trend of global trade protection initiated by United States.
The bloc’s next trade agreement could be with the United Arab Emirates (UAE) before the end of June, Paraguay’s finance minister Carlos Fernandez told LatinFinance.
Speaking on the sidelines of the annual meeting of the IDB Group in Asunción, he said Mercosur “wants to be close to everyone on economic terms.”
“We are open to trade with every single area around the world,” he added.
The bloc’s free-trade push comes as global supply chains face their biggest disruption since the pandemic following the onset of war in the Middle East and an effective blockade by Iran of the Strait of Hormuz, which has sent oil and gas prices skyrocketing and sparked fears of a global economic downturn.
Mercosur and the UAE have held five rounds of the negotiation, the most recently in November 2025. Paraguay, which held the rotating Mercosur presidency when talks with the UAE began in 2024, wants to conclude negotiations before it hands off the presidency to Uruguay later this year. Brazil and Argentina are also members of the bloc.
Free trade talks with Canada have been on and off since 2018, but the goal now is to finish negotiations in the first half of this year. The bloc held the eighth round of talks with Canada in late February.
POLITICAL WILL
The trade pact between Mercosur and the EU was signed on January 17 after more than 25 years of negotiations. However, the deal was approved by lawmakers in the four Mercosur countries in less than two months to ensure preliminary implementation. The EU’s Court of Justice needs to carry out a legal review.
The trade pact immediately eliminates more than 80% of tariffs worth billions of dollars for the two trading areas, which have a combined population of more than 700 million. Most remaining tariffs will be eliminated over the next 15 years. Mercosur countries are anticipating a big bump in growth, with Uruguay estimating up to 1.5 points to GDP growth.
Mercosur leaders now hope that the agreement will provide the political will to move on other trade pacts.
The bloc also concluded a free-trade agreement with the European Free Trade Association, which includes Iceland, Liechtenstein, Norway and Switzerland, in 2025, but it has not come into force.
An agreement with Singapore was approved in December 2023.
