Uruguay advances free trade talks with China, aims to be Mercosur ‘gateway’

Uruguay's President Luis Lacalle Pou attends a news conference at the Planalto Palace in Brasilia
Uruguay's President Luis Lacalle Pou attends a news conference with Brazil's President Jair Bolsonaro (not picutred) at the Planalto Palace in Brasilia, Brazil February 3, 2021. REUTERS/Adriano Machado

September 8, 2021

MONTEVIDEO (Reuters) -Uruguay’s government is pushing ahead with free trade talks with China, hoping the small South American nation can became a “gateway” for the regional Mercosur bloc in negotiations with the Asian powerhouse.

Uruguayan President Luis Lacalle Pou, who has long pushed for an agreement with China to boost exports of key products such as beef, revealed late on Tuesday that China had made a “formal proposal” to push forward the process.

On Wednesday, key Uruguayan government adviser Alvaro Delgado told reporters the objective was for Uruguay to be a “gateway to Mercosur” for China.

“That is the ultimate goal and perhaps the most important,” he said at a news conference.

Lacalle Pou had said back in July that Uruguay would negotiate the trade agreement with China on its own, leading to tensions with Mercosur members Argentina, Brazil and Paraguay.

Argentine Minister of Productive Development, Matías Kulfas, challenged Uruguay’s later on Wednesday.

Uruguay “can make a bilateral agreement with China outside of Mercosur or it can continue in Mercosur. Mercosur regulations are very clear: the agreements are made as a bloc, they are not made bilaterally,” Kulfas told reporters.

“It is a decision that the Uruguayan government will make and we will be observing what it does,” he added.

If successful, Uruguay would join neighboring Chile and Peru in signing free trade agreements with China.

Lacalle Pou said on Tuesday that Uruguay would conduct a formal study regarding the proposed trade deal with China to be presented by the end of the year.

China is already Uruguay’s main trading partner, buying some 30% of its exports, including 56% of its meat, Uruguay’s main export.

(Reporting by Fabian WernerEditing by Paul Simao and Sandra Maler)