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Uruguay’s global ambitions for trade deals.

 

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Presidential meetings of the South American Mercosur alliance were usually sedate affairs until Uruguay decided to «open up to the world» under its pro-business leader, Luis Lacalle Pou. Hard at work negotiating new deals outside the regional bloc since taking office in March 2020, Lacalle Pou’s ambitions are running up against the other Mercosur members, who are closing ranks on Uruguay as political alliances shift. Those tensions erupted at the summit in the Uruguayan capital Montevideo this month amid accusations of foul play and unsportsmanlike tactics on news that Uruguay had independently applied to join the Trans-Pacific Partnership days previously, a trade alliance including Australia and Japan. «Uruguay needs to choose if it is with Mercosur,» Argentina’s foreign minister, Santiago Cafiero, said at the summit, in which Uruguay transferred the Mercosur presidency to Argentina.

The three other Mercosur members have called for regional unity, threatening to penalise Uruguay with undisclosed measures if it continues to pursue deals alone. «There has not been, nor will there be, a single action by my country that can be interpreted as Uruguay promoting the end of Mercosur,» minister Francisco Bustillo told the summit. Last week, the Uruguay-China chamber of commerce reiterated its support for Montevideo to deepen trade ties between the two, saying that «advancing» the FTA with China was «central». Ignacio Bartesaghi, international relations professor at Uruguay’s Catholic University, said the government’s mistake had been to «take on too many deals at once», unnerving members at a time of political change in Brazil, which will affect the group’s dynamics.

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