Israel is the first country outside South America to sign a free trade agreement with the regional Mercosur bloc. Brazilian President Lula da Silva visted Israel last week
Israel signed last week a new free trade agreement with Brazil, and the rest of the Mercosur bloc - Argentina, Paraguay and Uruguay - making Israel the first non-Latin American country to sign such a deal with Mercosur.
Brazilian President Lula da Silva met with Israeli President Peres in Jerusalem last week and said that Brazil had given its final approval for a free trade agreement between Israel and the Mercosur bloc.
Israel is the first country outside South America to sign a free trade agreement with the regional bloc whose members produce over US$3 trillion in GDP and have a combined population of over 270 million.
President Peres and President Lula opened an economic conference together in front of hundreds of Israeli and Brazilian business leaders. The Israeli Minister of Industry, Trade, and Labor Mr. Binyamin Ben-Eliezer, the Israeli President of the Manufacturers Association Mr. Sharga Brosh, the Brazilian President of the Sao Paulo Industrialist Association (FIESP) Mr. Paulo Skaf, and the Brazilian Minister of Development, Industry and Foreign Trade Mr. Miguel Jorge, joined the presidents. The agreement takes 30 days to come into effect and will come into force in early April 2010. Brazil expects the result will be a swelling in bilateral trade, to more than US$3 billion within five years.
Lula da Silva said Israel was “an ideal partner” to help develop its semiconductor, nanotechnology and pharmaceutical industries.
“We hope to advance economic and business ties between Israel and Brazil as trade has increased significantly between our two countries in the past few years,” he said. He also said Brazil was seeking to widen economic ties with Israel ahead of the 2014 World Cup and 2016 Olympics.
Brazil is Israel's largest trade partner in Latin America and with the approval of the agreement trade is expected to increase by the billions of dollars, especially in the sectors of agriculture, education, science, medicine, space and will reinforce the mutual investments by both countries.
Israel and Brazil formerly had a surplus trade agreement. In 2008, trade between the two countries totaled US$1.6 billion, of which US$1.2 billion were exports from Israel, mostly chemicals and fertilizers used in Brazilian agriculture.
Venezuela, Colombia, Chile and Ecuador are in various stages of integration into Mercosur, with Venezuela on track for full admittance.