Brazilian Socialists Strike Controversial ‘Free Trade’ Deal with Palestinian Authority

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In a show to support the anti-Israel movement, the socialist government of Brazil declared on Monday it had signed a free trade deal with the Palestinian Authority (the organization responsible for the West Bank).

Brazil, which recognizes “Palestine”, as a sovereign state, and has withdrawn its ambassador from Israel following the brutal October 7 attack on Israel by Hamas terrorists, implemented the deal through the long-delayed ratification of a proposed free trade agreement, between the “state Palestine” and Mercosur. Mercosur is a regional trading bloc that includes Brazil, Argentina Paraguay, and Uruguay. The other Mercosur members have not approved the agreement.

Brasilia referred to the agreement as a “free trade agreement” with “Palestine”, but it seems to apply only to the Palestinian Authority and not to Hamas which controls Gaza.

The agreement comes after a month of hostile statements by the radical leftist president Luiz Inacio Lula Da Silva. Israel had declared Lula persona non-grata back in February when he compared Israel’s self-defense operations against Hamas with Nazi Germany. Israel has demanded that Lula apologize for his statements against Israel. Lula refused to do so, instead accusing Israel of “genocide”, because it waged war against Hamas.

Lula announced that the agreement would be ratified during Monday’s Mercosur Summit.

Lula stated, “We are proud to have been the first country to ratify a free trade agreement with Palestine.” “But I can’t help but be sad that this happens in a context where the Palestinians are suffering because of an irrational conflict.”

The Brazilian Foreign Ministry announced on Monday that the Free Trade Agreement was now in force and would help with supporting the “Palestinian’ cause against Israel, and developing deeper ties to the greater Middle East. Israel is presumably not included.

The Foreign Ministry released a statement Friday, before the implementation of the agreement, explaining that the deal was a free trade document created by Mercosur, and introduced to the block by Paraguay which accepted Brazil’s approval last week. The Foreign Ministry noted that the “state of Palestine,” which appears to be the Palestinian Authority on the West Bank, had ratified this free trade agreement in April.

Since both the Palestinian Authority (PA) and Brazil signed the deal, the Foreign Ministry clarified the fact that the agreement does not bind the other Mercosur countries until each of them ratifies the free trade agreement on a personal basis. At press time, it was not known if the three other South American countries, which are all led by right-wing leaders, would follow suit. Argentina is expected to be the exception, as its libertarian president Javier Milei has strong support for Israel and prioritized a trip to Israel after October 7.

Milei chose to not attend the Mercosur Summit and instead traveled to Brazil while Lula wasn’t in the country. Milei took the opportunity to speak at the Brazilian Conservative Political Action Conference and to meet former Brazilian President Jairbolsonaro who once promised to open an embassy for Brazil in Jerusalem but never did.

The Brazilian government pointed out that although the Palestinian Authority signed the free-trade agreement in April 2011, it had been in the Mercosur bureaucracy’s possession since 2011.

The Brazilian Foreign Ministry stated on Friday that “the agreement is a tangible contribution towards an economically sustainable Palestinian state, which can live in harmony and peace with its neighbors.”

Brazil said the agreement will cover “trade in goods, rules of origin, bilateral safeguards, technical regulations, compliance standards and procedures, assessment and compliance standards and procedures, sanitary and phytosanitary actions, technical and technological co-operation, institutional arrangements, and dispute resolution.”

Lula’s overture towards the Palestinian Authority is likely to sour Israel’s relations further. Brazil has always maintained a friendly relationship with Israel. However, Lula’s support for Hamas following the October 7 attack outraged Israel. Lula has accused Israel repeatedly of “genocide”, including less than one month after the attack on October 7. The relationship deteriorated in February when Lula compared Israel’s self-defense to the Holocaust.

“What is happening to the Palestinians in Gaza Strip has no historical parallel.” Lula’s speech to the African Union Summit, held in Ethiopia in August, said that it was in fact there when Hitler decided to murder the Jews.

Lula was banned from Israel by the Israeli government until he apologized, something he had not done as of press time. The Israeli ambassador was also summoned.

“What a shame. Your comparison is promiscuous and delusional. In a message on social media, Israel Katz, Israeli Foreign Minister at the time said: “Shame on Brazil. It’s a spit into the faces of Brazilian Jews.” It’s still not too late for you to apologize and learn from history. You will be persona non-grata until then in Israel!

Lula, rather than apologize, claimed that Israel lied about his statements. He tried to argue that Lula’s references to “when Hitler decided to kill the Jews”, were not meant to invoke the Holocaust.

“I didn’t say the word ‘Holocaust.’ ‘Holocaust’ was the interpretation of the Prime Minister of Israel. It wasn’t mine,” Lula claimed.

Lula has not yet replaced his ambassador in Tel Aviv, despite recalling him in May. This is a sign of the deterioration of bilateral relations.