Rousseff and Merkel discuss MERCOSUR-EU deal

President Dilma Rousseff hosted a dinner for Germany Chancellor Angela Merkel at Palácio da Alvorada, the official Brazilian Presidential residence, on Wednesday (Aug. 19). The two will meet again today to discuss details of a prospective MERCOSUR-European Union agreement.

Ministers of the two countries should hold sectoral meetings to set the terms of the agreements to be signed during Merkel's visit. At least fifteen deals are expected in such areas as innovation, research, mining, education, healthcare, and food security.

According to the Minister of Development, Industry and Foreign Trade, Armando Monteiro Neto, who attended the dinner event, the “central topic” of the meeting is the beginning of trade as part of the MERCOSUR-EU deal. Another issue of great interest between the two countries is the possibility of Germany investing in Brazil.

Business leaders were reported to describe Germany as a “strategic partner” for Brazil, saying that the two countries have plenty of exchange opportunities in such areas as innovation, industry, and renewable energy. Germany is Brazil's main trading partner in Europe and the fourth worldwide (behind only China, the United States, and Argentina). Trade between the two countries amounts to more than $20 billion. About 1,600 German companies are located in Brazil, some of them centuries old, Minister Monteiro said. According to him, the two countries' partnership and investment programs are likely to continue given Germany's “great interest” in Brazil.

With high value-added imports from Germany, the minister recognized that Brazil has had a trade deficit with the European country, but argued that “this deficit is not really a problem, because Brazil needs the goods it imports from Germany. They are in a technological development stage that makes them a much-needed supplier of key quality equipment to Brazil. Our strategy is to find ways to add more value to our exports as well.”

Translated by Mayra Borges