Lee and Lula revive bid for Korea-Mercosur pact, bolster defense ties

South Korea and Brazil opened the way Monday to reviving stalled trade talks between Seoul and the South American bloc Mercosur, forming a bilateral working group with an eye toward a formal restart in December, Cheong Wa Dae said.

At their summit in Brasilia, President Lee Jae Myung and Brazilian President Luiz Inacio Lula da Silva also pledged to broaden trade and economic cooperation in strategic sectors including aerospace, critical minerals and defense.

The announcements followed a 140-minute meeting that underscored the affinity between Lee and Lula, whose shared journeys from childhood factory work to the presidency were reflected in repeated embraces and handclasps.

Their fifth meeting since Lee took office came about a month after an impromptu meeting on the sidelines of the Group of Seven summit in Evian. Lee’s trip marked the first state visit to Brazil by a South Korean president in 11 years and followed Lula’s visit to Seoul in February.

At a joint news conference following the summit, Lee said he and Lula “agreed to strengthen economic cooperation, a key driver of bilateral relations.”

The two leaders agreed to revive negotiations between South Korea and Mercosur’s four founding members — Argentina, Brazil, Paraguay and Uruguay — which have been stalled since 2021.

“We reached a profound consensus that, at a time of growing uncertainty in the global trading environment, a trade agreement between Korea and Mercosur is a crucial task that can no longer be postponed,” Lee said.

“I am confident that the Korea-Mercosur Trade Agreement will expand opportunities for Korean companies to enter Mercosur, while providing Brazilian businesses with new opportunities to access the Asian market, with Korea serving as a gateway.”

Lee added that the agreement would broaden cooperation beyond trade to include high-tech industries, supply chains and the digital and green economies.

“In doing so, it will serve as a solid foundation for our two countries to grow together as true strategic partners,” Lee said.

The two leaders agreed to establish a working group to revive the stalled trade negotiations and expand bilateral cooperation across economic and security issues.

Brazilian Vice President Geraldo Alckmin and South Korean presidential policy chief Kim Yong-beom will lead the group.

“We have agreed to establish a working group. By identifying sensitive issues, we will work to ensure that there are no obstacles to resuming negotiations on a trade agreement between South Korea and Mercosur,” Lula said through an interpreter.

Lee said that the working group would provide a channel for “direct communication on advancing bilateral relations.”

“Through this channel, we will deepen cooperation and exchanges between South Korea and Brazil — which remain far too limited — in every area, including the economy, industry, security and culture,” Lee said. “And, of course, we will ensure that progress is made very quickly.”

Senior spokesperson Kang Yu-jung later explained that the two leaders had “agreed to establish a bilateral Korea-Brazil working group to analyze trade opportunities and sensitivities, with a view to announcing the resumption of negotiations at the 69th Mercosur Summit in December.”

Speaking at the joint news conference, Lee also said the leaders had agreed to “strengthen strategic cooperation in resources and energy in order to diversify our supply chains.”

“President Lula and I shared the view that it is important to expand cooperation between our companies and institutions across the entire critical-minerals value chain,” he said.

Brazil is home to some of the world’s largest reserves of critical minerals, including niobium, rare earths, graphite and nickel, which are essential to advanced industries and the clean energy transition.

Lee said the two leaders committed to “creating new growth engines by expanding cooperation in advanced and emerging industries.”

In defense, the two countries agreed to launch a joint defense industry committee in the second half of this year.

Seoul and Brasilia will pursue a General Security of Military Information Agreement, commonly known as GSOMIA, which Lee said would “generate new opportunities for cooperation in defense and the defense industry.”

According to Cheong Wa Dae, the two sides have opened negotiations on a GSOMIA.

Lee further cited the use of Korean-made components in Brazil’s C-390 military transport aircraft, which the South Korean Air Force is scheduled to begin introducing in the second half of this year, as “a symbolic example of defense industry cooperation between the two countries.”

“We agreed to advance such cooperation and explore new partnerships in future air mobility by leveraging our respective strengths.”

South Korea selected Embraer’s C-390 in December 2023 under an offset arrangement involving a consortium of South Korean small and medium-sized companies in the production of key components, including the rear fuselage. The acquisition marks the first time the South Korean Air Force has purchased a Brazilian military aircraft.

Lee also called for Lula’s support for South Korean defense exports to Brazil.

“Given Brazil’s leading position in Latin America’s defense industry, I would greatly appreciate your special interest and support so that Korea’s diverse defense systems — whose outstanding performance has been proven — can also gain recognition in Brazil,” Lee said.

The two leaders also committed to expanding cooperation in aviation and space.

South Korea and Brazil signed a memorandum of understanding on cooperation in the peaceful exploration and use of outer space following the summit. The agreement is intended to streamline procedures for commercial launches and broaden cooperation in the space sector, including satellite data sharing and space exploration.

Lee said the agreement “will play a key role in enabling the two countries to jointly open a new chapter in the future space era.”

At the news conference, Lula unexpectedly invited Lee to attend the planned joint launch of a new rocket from Brazil’s Alcantara Space Center in September, without providing further details.

In response, Lee said he hoped to witness the launch in person but would watch by video link if he could not attend.

The two sides will also pursue cooperation in semiconductors.

“We agreed to work together to make cooperation with Korean semiconductor companies a model of a mutually beneficial partnership — strengthening Brazil’s industrial competitiveness while providing Korean businesses with a stable production base,” Lee said.

In closing, Lee cast the partnership between Korea and Brazil as one capable of bridging the vast distance between them.

“When our two countries combine their respective strengths, the vast ocean separating us will no longer be a barrier,” Lee said. “Instead, it will become a space of possibility where new opportunities are created.”