Mercosur, Japan launch trade talks; summit in Paraguay key milestone

Mercosur and Japan have officially begun talks for an Economic Partnership Agreement, a significant step that will be a central topic at the Mercosur summit in Paraguay on June 30. This move signals Japan's strong interest in a free trade understanding with the South American bloc.

Brazilian President Luiz Inácio Lula da Silva and Japanese Prime Minister Sanae Takaichi announced the formal start of negotiations. The summit in Luque will host leaders from Paraguay, Argentina, Brazil, and Uruguay. A joint statement highlighted the "common will" of both parties to advance the agreement, with Lula emphasizing the upcoming Mercosur summit as a crucial juncture.

“

With the common will of all parties, the two leaders announced the launch of negotiations for the Economic Partnership Agreement between Mercosur and Japan.

Japanese economic daily Nikkei reports that negotiations will center on three main areas: reducing tariffs on automobiles, securing access to alternative energy sources, and ensuring the supply of critical minerals. Preliminary meetings began in January 2026, with further discussions held in March during the World Trade Organization conference in Cameroon.

The urgency for Japan stems from its significant reliance on oil imports from the Middle East and recent disruptions. Mercosur offers vital resources such as oil, lithium (with Argentina being a major producer), and rare earths (Brazil holds substantial reserves essential for digital industries and defense). Additionally, the automotive sector is a key driver, as Japanese manufacturers like Toyota, Honda, and Nissan face high tariffs in Mercosur countries, hindering their competitiveness against European rivals.

“

The Mercosur summit on June 30 in Paraguay is the next key moment in the process.