According to several media reports, Canada and the South American trading bloc Mercosur are expected to announce the formal launch of trade talks, during a meeting on March 9 between Canadian trade minister François-Philippe Champagne and his Mercosur counterparts in Asunción, Paraguay.

The Government of Canada held consultations last year on the scope of potential negotiations regarding a possible free trade agreement (FTA) between Canada and Mercosur.

Also known as the Southern Cone Common Market, Mercosur is a customs union established by Argentina, Brazil, Paraguay and Uruguay in 1991. This regional bloc represents a significant economic presence in Latin America. In 2016, the four members of Mercosur had a combined GDP of US$2.4 trillion (CAN$3.2 trillion) and a population of 260 million.

In 2016, Canada’s bilateral merchandise trade with the bloc totalled nearly $8.1 billion. Canadian direct investment abroad in the bloc was valued at $14.7 billion and the bloc’s total inward foreign direct investment stock is valued at $19.7 billion. Two-way services trade between Canada and Mercosur’s Argentina and Brazil nearly reached $1.3 billion in 2015.