Mercosur exposes economic and political clash between Lula and Milei

The 66th Mercosur Summit showed a shock of visions between the presidents of Brazil, Luiz Inacio Lula da Silva, and Argentina, Javier Milei, about the Southern Common Market (Mercosur). In opposite speeches, the Argentine president harshly criticized Mercosur’s current structure, which called the “Iron Shirt”, while Lula defended regional integration as a strategy to protect South America in the face of global trade tensions.

At the opening ceremony of the Mercosur summit, Milei returned to condition Argentina’s permanence in the bloc to the flexibilization of commercial rules, and stressed the need to make Mercosur a free trade platform with less norms and institutionality. Lula, in turn, highlighted the political and strategic importance of the bloc to strengthen the regional position in the face of the so -called “commercial war” opened by the United States, and announced that the Brazilian temporary presidency intends to prioritize agendas as an environment, digital inclusion and social policies.

Lula’s promise is to expand the block’s agenda beyond trade, including new topics. Analysts heard by the report, however, consider this movement difficult, given the Argentine resistance and Brazilian tax limitations. “Lula will try to strengthen institutionality and advance on social and environmental guidelines, but it will be a challenge, because countries in the region have no resources for large projects and Brazil, even though it is the paymaster [principal financiador] From the block, it faces its own restrictions, ”says political scientist Elton Gomes.

Despite the climate of tension, the countries were able to approve a free trade agreement with the European Block EFTA, formed by Switzerland, Norway, Iceland and Liechtenstein. The agreement, according to Gomes, is typical of the so -called “sectoral thematic cooperation” in areas where there are no great differences, such as trade and technical issues.

Lula and Milei have antagonistic conceptions about foreign policy

The tensions between the presidents Luiz Inacio Lula da Silva and Javier Milei, evidenced at the Mercosur summit, are a direct reflection of the antagonistic conceptions in foreign policy adopted by Brazil and Argentina. For political scientist Elton Gomes, differences transcend the rhetorical field and indicate opposite projects for the bloc’s future.

“Milei adopted a very critical and incisive stance, questioning Mercosur’s own structure and conditioning Argentine permanence to substantial changes. Lula follows the Latin American developmental tradition, seeing the bloc as an instrument of economic protection and institutional strengthening of the region,” he says.

The Doctor of Political Science Leandro Gabiatti also highlights this contrast. According to him, the speeches of Lula and Milei walk in opposite directions: “While Milei points out problems arising from Mercosur’s tariff policy, Lula exalts the strength of the bloc as a strategic tool to negotiate with other countries before the US tariff war.”

Despite the high tone of the differences, there are points of convergence. As Gomes notes, both governments recognize the importance of keeping Argentina in the block. “There is no Mercosur without Argentina. This is a point of consensus. Even with distinct rhetoric, there is a recognition that the rupture would be disastrous for the block and bilateral trade relations,” he says.

On the other hand, the diplomat and teacher Paulo Roberto de Almeida evaluates that, in practice, the threat of Argentina’s departure from Mercosur does not hold economically. “Argentina benefits from the Brazilian market, which is often larger than Argentine. This discord has not much practical sense,” he says.

For him, public positions can meet the internal interests or ideological narratives, but, in the commercial plane, the interdependence between the two countries and the strategic relevance of the bloc make any effective breakup.

In Argentina, Lula is with former president convicted of corruption

During his time at Buenos Aires to the Mercosur summit, Lula made a point of meeting former President Cristina Kirchner, who has been in home arrest since June 17. The former president was sentenced to six years in prison for corruption. Lula’s visit even had to be authorized by the Argentine court.

Lula and Cristina share a political trajectory anchored in the defense of public policies to combat poverty, state strengthening and sovereign regional integration – precisely the opposite of Milei’s project, which has made harsh criticism of the so -called “left populism” that has dominated part of South America in the last 20 years.

More than a meeting of ancient allies, the visit was a clear sign that, in addition to the divergence of the Mercosur economic integration model, there is an evident political-ideological mismatch between Lula and Milei.

Political scientist Elton Gomes recalled that the Kirchner were Lula’s allies even when he was in prison. For Gomes, despite “getting bad”, the petista’s visit to the former president Argentina is a matter of personal gratitude, which he classified as “ideological solidarity”.

“The greatest damage generated in the image of the president is with the considerable portion of Brazilian public opinion that already rejects him. A growing part of his own electorate who has lost confidence in the leader and his government, as shown categorically in the latest opinion polls conducted in the country,” says the political scientist.

At the same time, Lula did not have a bilateral meeting with Milei in this trip to Argentina. This is the second time the presidents have met, but they do not share agendas. When Milei was in Brazil for the G20 summit in November 2024, likewise, had no bilateral agenda with Lula.

Prior to that, the president of Argentina was also in Brazil in July 2024, when he participated in the conservative CPAC conference (Conservative Political Action Conference). On the occasion, Milei met with former President Jair Bolsonaro (PL) and made harsh criticism of the socialist governments of South America. He also pointed to persecution of right names in several countries, including Brazil.

In addition, diplomat and teacher Paulo Roberto de Almeida points out that Lula has emphasized his friendships with dictators. He recalls that in May, the petista visited Russian dictator Vladimir Putin for the celebrations of the “Day of Victory”, which brought him even closer to the country, even in the context of the invasion of Ukraine.

Almeida also mentions that Lula decided to house the wife of former Peru-president Nadine Heredia, sentenced to 15 years in prison for qualified money laundering, due to the receipt of bribes from both the former Venezuelan dictator Hugo Chavez and Odebrecht. In this context, for Almeida, Lula’s visit to Cristina Kirchner confirms the “party and ideological connivance [de Lula] with your supposed allies ”.

Elton Gomes also evaluates that the fact also causes image loss with the partners of US -led Liberal Democracies, notably among European countries. “[Lula] gives someone the impression with an ideological and personal agenda that overlaps the legal and institutional issues; For those who are worth the loyalty to the political flag corners than justice, ”says Gomes.