Merz hails EU-Mercosur trade deal as he hosts Brazil's Lula

German Chancellor Friedrich Merz on Monday hailed a new EU trade deal with four South American countries as "a response" to current geopolitics dominated by a number of power players, as he hosted Brazil's President Luiz Inácio Lula da Silva in Germany.

The EU trade deal with the Mercosur countries Brazil, Argentina, Uruguay and Paraguay, which is set to be applied provisionally from May 1, is "a response to all those who today seek to replace a rules-based order, treaties and reliability with power politics using military means," said Merz.

The German leader was speaking alongside Lula as the pair visited the Hannover Messe trade fair in northern Germany, the world's leading industrial trade show. Brazil is this year's guest country.

Lula called for cooperation between Europe and Latin America to be made "ever more productive, ever more effective and ever better."

Striking a similar note as Merz, he highlighted the importance of a world order based on rules and international institutions.

"The world cannot be governed by lies," he said. "The world cannot be governed in such a way that someone believes they are more important than others and makes decisions that they impose on the world as if there were no democracy."

Leaders tour trade fair separately

More than 3,000 exhibitors, including SAP, Microsoft and Siemens, are showing their latest innovations at the Hanover trade show until Friday. The event attracted around 127,000 visitors last year.

Before they were due to hold government consultations later on Monday, Merz and Lula toured the trade grounds, though the visit did not go as expected.

Organizers of the fair were left baffled when the two leaders went their separate ways following a brief opening statement on the first day of the trade show.

They initially visited the Brazilian stall together, but while Lula then continued to check out further Brazilian exhibitors, Merz made off on his own, and a planned joined statement at the end of the tour was cancelled.

Police and trade fair officials expressed surprise.

"We've never seen anything like this before," trade fair officials said.

Government sources told dpa afterwards that both sides had mutually agreed to conduct separate visits to different exhibition stands "due to a delay on the part of the Brazilian delegation."

In order to cover as many companies as possible, the two leaders had decided to split up, they said, adding that "this allowed the programme to be carried out in the best possible way."

Government consultations to focus on trade

The bilateral meeting later on Monday was set to also include a total of 15 ministers from both camps, with the sides expected to discuss strengthening relations in areas including trade, raw materials, defence, digitalization, research and climate protection.

The Mercosur trade deal, which will create a free trade zone of more than 700 million people, is expected to be a particular focus of discussions.

The current energy crisis and actions by US President Donald Trump against Iran and towards Latin American countries such as Venezuela and Cuba are also likely to be discussed.

"Trump was not elected emperor of the world," Lula told Der Spiegel magazine ahead of his visit to Germany. "He cannot constantly threaten other countries with war."

Germany holds government consultations with particularly close partners such as France, Poland and Italy or key countries such as Brazil or India. Germany is Brazil's fourth-largest trading partner.

Merz and Lula met on Sunday at Hanover's Herrenhausen Palace for one-on-one talks before attending the opening of the trade fair.