Lula enacts Mercosur–European Union agreement and submits two additional treaties to Congress

President Luiz Inácio Lula da Silva signed the decree enacting the trade agreement between the European Union and Mercosur on Tuesday (April 28) at the Planalto Palace. The measure is the final step to incorporate the treaty into Brazil’s legal framework. The provisional trade agreement between the two blocs will enter into force this Friday, May 1.

The enactment follows approval of the text by the National Congress. The treaty creates a free trade area among 31 countries, with around 720 million people and a combined gross domestic product (GDP) of more than USD 22 trillion. In terms of population and the size of the economies involved, it is one of the largest bilateral free trade agreements in the world.

This symbolic gesture we are making here may seem simple, but it is an agreement that took 25 years. And it comes at a very important moment, because it reinforces the established idea of multilateralism."
Luiz Inácio Lula da Silva
President of the Republic of Brazil

This symbolic gesture we are making here may seem simple, but it is an agreement that took 25 years. And it comes at a very important moment, because it reinforces the established idea of multilateralism. — Luiz Inácio Lula da Silva, President of the Republic of Brazil

Lula recalled the long process leading to the conclusion of the agreement. “This symbolic gesture we are making here may seem simple, but it is an agreement that took 25 years. It was not one, two, three, or four presidents of the Republic, ministers of Foreign Affairs, ministers of Industry and Trade, ministers of Agriculture, and many others who tried to make this agreement happen,” he said. “And it comes at a very important moment, because it reinforces the established idea of multilateralism,” he added.

On the occasion, President Lula signed two messages to be sent to Congress regarding Mercosur trade agreements with Singapore and the European Free Trade Association countries. He also referred to ongoing negotiations by the bloc.

“We are working on an agreement with Canada. We are working to bring Colombia into Mercosur, and perhaps tomorrow we can extend this to other countries, because people need to understand that there is no individual solution for any country in this world of trade,” Lula said.

FREE TRADE — Brazil’s Minister of Foreign Affairs, Ambassador Mauro Vieira, highlighted the significance of enacting Mercosur’s largest trade agreement. “This agreement is a historic milestone for our blocs, which as of May 1 will form one of the largest bilateral free trade areas on the planet. It represents a deepening of our relationship with our second-largest trading partner and Brazil’s largest foreign investor. It has the potential to diversify our global partnerships, increase our exports, and definitively integrate Brazil into European value chains,” he said.

Vieira noted that Mercosur is also negotiating agreements with the United Arab Emirates, Vietnam, India, Japan, and the Southern African Customs Union.

According to Brazil’s Minister of the Secretariat of Institutional Relations of the Presidency, José Guimarães, the enactment of the agreement represents a major achievement for Brazilian foreign policy. “All of us who are parliamentarians and ministers know the personal effort President Lula made to bring this about. I want to applaud Brazilian foreign policy, which today celebrates one of its greatest moments,” he highlighted.

TARIFFS ELIMINATED — As of May 1, the European Union will eliminate import tariffs on more than 5,000 products, representing about half of its tariff universe. Over the course of implementation, the agreement could liberalize more than 90 percent of bilateral trade, expanding access for Brazilian exports to a market of around 450 million consumers.

The European Union will eliminate tariffs on 92 percent of Mercosur exports, valued at approximately USD 61 billion. In addition, it will grant preferential access to another 7.5 percent, equivalent to USD 4.7 billion, benefiting nearly all exports from the bloc to the EU. This significantly expands Mercosur’s access to the European market, improves trading conditions, and strengthens the competitiveness of companies in the region.

PARTNERSHIP — Beyond its economic and commercial dimension, the agreement reaffirms the partnership between the two regions, grounded in shared values and interests, such as the defense of democracy, multilateralism, and human rights.

SINGAPORE AND EFTA — The agreement with Singapore, the first signed by Mercosur with an Asian country, guarantees immediate duty-free access for 100 percent of the bloc’s exports to that market. On the Mercosur side, around 95.8 percent of the tariff universe is liberalized, with phased reduction schedules. The treaty includes modern rules in areas such as digital trade, services, investment, public procurement, and small and medium-sized enterprises, while positioning Brazil in one of the most dynamic regions of global trade.

The agreement with the European Free Trade Association (EFTA), composed of Norway, Switzerland, Iceland, and Liechtenstein, expands access to high-income, technologically advanced economies. The treaty covers areas such as services, investment, government procurement, intellectual property, and innovation, strengthening Brazil’s integration into global value chains and expanding opportunities for industrial and agricultural exports.

BLOC — Formalized by the Treaty of Asunción in 1991, Mercosur marked 35 years of existence in March 2026.

Over three and a half decades, intra-bloc trade has increased elevenfold, reaching USD 51 billion in 2025. In the past three years, free trade agreements have been concluded with Singapore, the European Free Trade Association (EFTA), and the European Union. In 2025, the bloc’s external trade exceeded USD 800 billion, highlighting its growing global integration.