Since 2018 Canada has been negotiating a free trade agreement (FTA) with Mercosur, a trading bloc and customs union consisting of Argentina, Brazil, Paraguay, and Uruguay. Mercosur as a bloc represents a real GDP of over $2.5 trillion and a population of 295 million (2020).
In November 2017, Canada and Mercosur concluded the exploratory discussions on a possible FTA. The negotiations were officially launched on March 9, 2018 in Asuncion, Paraguay. Seven rounds of negotiations have been held to date, most recently from July 29 to August 2, 2019.
A comprehensive FTA with a large, emerging market such as Mercosur would provide improved market access for Canadian goods and services, creating more opportunities for exporters to tap the rapidly-growing market.
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Argentina
Cooperation between Canada and Argentina is flourishing, with both countries looking to expand trade and investment opportunities. In particular, the two countries are interested in cooperation in the following industrial sectors: exporting Canadian forestry products, machinery, vehicles and equipment, telecommunications equipment, and chemicals to Argentina; importing Argentine wine, beef, grains, oilseeds, metals, and minerals to Canada; investing in energy and mining projects in Argentina and partnering in infrastructure projects, such as building new roads and railways.
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Brazil
Both Canada and Brazil are leaders in a number of industries, including aerospace and automotive industries, mining, forestry, and agriculture. There is potential for further cooperation in the oil and gas and clean energy sector.
In terms of exports, the primary areas of cooperation between Canada and Brazil are mining, forestry, and agriculture. In terms of imports, the two countries work together in the automotive, aerospace, and electrical equipment industries. As for the investment, the primary focus is on energy and infrastructure with Canada interested in Brazilian energy resources, while Brazil is interested in Canadian mining and forestry companies.
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Paraguay
The benefits of collaboration between Canada and Paraguay are vast. They have a number of industries and technologies that could be shared and enhanced through collaboration. They both have thriving export industries, with Paraguay specializing in agriculture and Canada specializing in high-tech and advanced manufacturing products. As such, Paraguay is a major producer of soybeans, while Canada is a leading exporter of canola oil. Together, the two countries could develop new uses and applications for these crops that would benefit both economies.
In terms of imports, Canada relies heavily on oil, while Paraguay is a net exporter of electricity. Both countries could benefit from working together to develop new technologies and investment opportunities in these sectors.
Another area where Canada and Paraguay could work together is in the field of renewable energy. Paraguay has an abundance of hydroelectric resources, while Canada is a leader in the development of wind and solar power. By sharing expertise and collaborating on new projects, both countries could help reduce greenhouse gas emissions and combat climate change.
There is huge potential for collaboration in the education sector as well.
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Uruguay
Collaboration between Canada and Uruguay can be mutually beneficial. Canada could export goods such as lumber, agricultural products, and minerals to Uruguay. In return, Uruguay could export items such as beef, wine, and wood products to Canada.
In terms of imports, Canada could import items such as beef, fruit, and vegetables from Uruguay. In turn, Uruguay could purchase products such as wheat, maize, pork, beef, canola oil, lumber, and vehicle parts.
There are many investment opportunities between Canada and Uruguay. There is great potential for collaboration between the two countries in the agriculture and energy sectors. Uruguay is a major producer of beef, soybeans, and wheat. Canada is a major producer of pork, canola oil, and other agricultural products. As for the energy sector – Uruguay is also a major producer of hydroelectric power while Canada has a wealth of experience in the energy sector and is a leader in renewable energy technologies.