Brazil threatens to abandon Mercosur-EU deal as Italy, France seek delay

Brazil’s President Luiz Inacio Lula da Silva speaks during the opening of Sao Paulo International Motor Show, on the day U.S. President Donald Trump removed his 40% tariffs on Brazilian food products, including beef, coffee, cocoa and fruits that were imposed in July, in Sao Paulo, Brazil, November 20, 2025. Ricardo Stuckert/Brazil Presidency/Handout via REUTERS ATTENTION EDITORS - THIS IMAGE HAS BEEN SUPPLIED BY A THIRD PARTY. NO RESALES. NO ARCHIVES.

SAO PAULO, Dec 17 (Reuters) - Brazilian President Luiz Inacio Lula da Silva said on Wednesday that if the trade agreement between the European Union and the South American trade bloc Mercosur is not finalized this month, Brazil will no longer sign off on the deal.

Italy and France earlier in the day said they were not ready to back the agreement, dealing it a blow as European Commission President Ursula von der Leyen had been expected to fly to Brazil at the end of this week to sign the accord.

"If we don't do it now, Brazil won't make this deal anymore as long as I'm president," Lula told a cabinet meeting. "If they say no, we will be tough with them from now on. We gave in to everything that diplomacy could possibly concede."

(Reporting by Gabriel Araujo and Eduardo Simoes; Writing by Isabel Teles)