By Micah Jonah
January 14, 2026
After 25 years of delays, the European Union and South America’s Mercosur bloc, including Brazil, Argentina, Paraguay and Uruguay, have finalized a landmark trade deal, signaling a decisive shift in the region’s global alliances.
The agreement comes as US influence in Latin America declines, with trade ties to China and Europe rising despite aggressive actions under the Trump administration. Recent US moves, including tariffs on Brazilian goods and the military capture of Venezuelan President Nicolas Maduro, coincided with the pact’s approval but did not prevent regional leaders from asserting independent economic strategies.
Officials say the deal could open doors for Mercosur to negotiate further agreements with Canada and the United Arab Emirates, demonstrating the bloc’s determination to strengthen multilateral trade rules and reduce reliance on US dominated systems.
European Commission representatives will travel to Asuncion, Paraguay, on January 17 for the formal signing, joined by Mercosur heads of state. The agreement underscores Latin America’s growing resolve to chart its own path amid shifting global power dynamics.
