Mercosur was created in 1991 by the Treaty of Asuncion and encompasses fife Latin American countries: Argentina, Brazil, Paraguay and Uruguay and Venezuela. The European Union has always favoured a strengthening of the Mercosur and always tried to support its initiatives. For this reason it signed an inter-institutional agreement to provide technical and institutional support for the newly created structures of Mercosur. In the year 1995, the EU and Mercosur signed an Interregional Framework Cooperation Agreement , which entered into force in 1999.

A joint declaration annexed to the Agreement provided the basis for the political dialogue between the parties, which takes place on a regular basis with meetings of senior officials from the two regions. The latest political dialogue meeting took place in Buenos Aires on 25 April 2008. In 2000 the parties opened negotiations for an association agreement based on three pillars: political dialogue, cooperation and a free trade area. While negotiations on the political and cooperation chapters are virtually concluded, the trade chapter still remains uncompleted.

On 17 December 2007, the European Commission and Mercosur issued a joint communiqué in order to renew the political commitment to re-launch and conclude the pending Association Agreement. Such commitment was confirmed by the Heads of State of the two regions, who met in Lima on 17 May 2008 in the margins of the EU-Latin America Summit. At the same meeting it was decided to explore opportunities to launch joint projects in the areas of Renewable Energy, Infrastructure and Science and Technology.

The EU provides assistance to Mercosur through its 2007-2013 Regional Programme adopted in August 2007 in the framework of the Regional Strategy for Mercosur. This regional programme provides EUR 50 million to support projects in three priority areas: (i) Mercosur institutional strengthening (ii) supporting Mercosur in preparing for the implementation of the Association Agreement and finally (iii) fostering the participation of civil society to Mercosur integration process. We will provide you with further information on this process.