In the end it wasn’t the blockbuster trade deal with the EU which provided the signing ceremony at last week’s Mercosur leaders’ meeting in Brazil, but a more modest agreement with the Asian city state of Singapore.

The occasion was also a final outing for Argentina’s President Alberto Fernández, who handed the office over to the colourful Javier Milei, who was sworn in on Sunday.

While he has toned down his campaigning language, he did warn of tough times ahead, as government spending had to be slashed in an attempt to stabilise the economy.

His imminent assumption of the presidency was a key factor in Mercosur and the EU failing to close the deal, which had been agreed back in 2019.

Since then, the EU has failed to progress ratification due to concerns about environmental policy, particularly in relation to deforestation in Brazil.

With the change of president there since the start of the year, Brazil has cracked down on forest clearance but many EU countries agreed with comments by the French president that standards were not yet the same in South America as in Europe.

While a deal with Singapore isn’t on the same scale as what was proposed with the EU, it is nevertheless an important trading partner in Asia for the South American countries.

Singapore is already a member of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) which has Chile, Colombia, Peru and Mexico as South American members though they aren’t Mercosur members.

Singapore’s trade with Mercosur countries was worth SG$13.8bn (€9.5bn) in 2022 and is the first Mercosur trade deal for a decade.