Mercosur, the Southern Common Market, is a South American customs union with five full members: Argentina, Brazil, Paraguay and Uruguay, which founded it with the Treaty of Asunción in 1991, and Bolivia, which became a full member on 8 July 2024. Venezuela is formally a full member too but has been suspended since 1 December 2016. Seven more countries, Chile, Colombia, Ecuador, Guyana, Panama, Peru and Suriname, are associate states. The full members share a common external tariff, in force since 1 January 1995, and count about 284 million people between them; the bloc's administrative headquarters is in Montevideo.
Full Member, Associate or Suspended: The Rules Set by the Treaty of Asunción
Membership in Mercosur comes in tiers, and the difference between them is about tariffs. A full member belongs to the customs union: it trades freely with the other full members and applies the same common external tariff to imports from outside. The Treaty of Asunción, signed in 1991, first created a free-trade zone, and the Protocol of Ouro Preto of 1994 set up the institutions and turned the zone into a customs union from 1 January 1995. Full members also take turns presiding over the Common Market Council, the bloc's highest body, in six-month rotations in alphabetical order, and the council decides by consensus.
An associate state sits outside the customs union. It keeps its own tariffs but has signed a free-trade agreement, called an economic complementation agreement, with the full members, and full compliance with that agreement's tariff timetable is what qualifies a country for associate status. Chile, the first associate, gained that status in 1996, the same year Bolivia did.
The treaty also makes joining hard. A new full member is admitted only when every existing member approves its accession by legislative decree, so a single national congress can block an applicant. And there is no exit by force: the bloc's rules contain no provision for expulsion, only suspension.
Edge cases: Paraguay in 2012 and Venezuela since 2016
Those rules produced Mercosur's two strangest years. Venezuela signed an accession protocol in 2006, and the congresses of Uruguay, Argentina and, in December 2009, Brazil approved it, but Paraguay's congress did not. On 29 June 2012, after Paraguay's Senate removed President Fernando Lugo, the other presidents suspended Paraguay until its next election in April 2013. With the Paraguayan veto out of the way, Venezuela was admitted as a full member on 31 July 2012.
Venezuela had four years to adopt the bloc's rules and did not complete them. In August 2016 the presidents of Brazil, Argentina and Paraguay refused to let it take the rotating presidency, and on 1 December 2016 it was suspended. On 5 August 2017 the foreign ministers of the four founders declared the suspension indefinite, citing a "rupture of the democratic order" after that year's Constituent Assembly elections. Because the rules allow no expulsion, Venezuela remains a suspended full member, and trade and migration arrangements with it were left unchanged to avoid worsening the country's crisis.
Bolivia's 12-year accession
Bolivia's path shows how slow the legislative-decree rule can be. President Evo Morales signed an accession protocol on 7 December 2012, and on 7 July 2015 he signed a revised Brasília protocol after the bloc's leaders accepted Bolivia's request. Every existing member then had to ratify it, which was completed only in December 2023. Bolivia finished its own ratification and became a full member on 8 July 2024. It has four years from that date to bring its laws into line with Mercosur rules. Because the EU deal was negotiated before its accession, Bolivia is not a party to it. Bolivia is also a member of the Andean Community, so it now belongs to both of South America's main trade blocs.
The Five Full Members, From Brazil to Uruguay
The full members are deeply unequal in size. Brazil alone had 203 million people at its 2022 census, and an estimated 214 million by 2026, more than three times the other four combined.
| Full member | Joined | Capital | Official language(s) |
|---|---|---|---|
| Argentina | 1991 (founder) | Buenos Aires | Spanish |
| Brazil | 1991 (founder) | Brasília | Portuguese |
| Paraguay | 1991 (founder) | Asunción | Spanish, Guarani |
| Uruguay | 1991 (founder) | Montevideo | Spanish |
| Bolivia | 2024 | Sucre (constitutional), La Paz (seat of government) | Spanish and 36 Indigenous languages |
| Venezuela (suspended) | 2012 | Caracas | Spanish |
The bloc grew out of a reconciliation between its two largest members. In December 1985 Brazil's José Sarney and Argentina's Raúl Alfonsín, both leading countries newly out of military rule and short of credit, signed the Iguaçu Declaration. A 1988 integration treaty set the goal of a common market, and on 6 July 1990 Fernando Collor and Carlos Menem signed the Buenos Aires Act on full customs integration. Paraguay and Uruguay asked to join that September, and the four signed in Asunción the next year.
Language follows the same split as population. Mercosur's working languages are Spanish and Portuguese, with Guarani recognised; Portuguese had over 214 million native speakers across the full members in 2021, against about 83 million for Spanish. Brazil teaches Spanish as a foreign language in schools, and Argentina and Venezuela have done the same with Portuguese.
Membership brings more than tariffs. Leaders agreed at their December 2004 summit to create a Mercosur Parliament, the bloc's flag was first raised at its Montevideo headquarters in 2001 to mark ten years since the treaty, and a December 2014 agreement with the International Organization for Migration supports the free movement of people between member states. Disputes still flare: in July 2023 Argentina clashed with Paraguay, Bolivia, Uruguay and Brazil over free navigation on the rivers of the Río de la Plata basin, including the Paraguay–Paraná system, a river outlet to the Atlantic for landlocked Paraguay and one of Bolivia's two.
Borders between members carry heavy traffic. The Friendship Bridge between Brazil and Paraguay, which held the world record for the longest reinforced-concrete fixed-arch span (290 m) when it was built in 1962, carries more than 40,000 vehicles a day. Intra-Mercosur merchandise trade, excluding Venezuela, rose from US$10 billion in 1991 to US$88 billion in 2010, with Brazil and Argentina each accounting for 43% of the total. Even so, trade among the members made up only 16% of their total merchandise trade in 2010, less than their trade with the European Union (20%) and comparable to China (14%) and the United States (11%).
The Seven Associates, From Chile in 1996 to Panama
Associate membership spread across South America through the Andean Community. Mercosur granted associate status to that bloc's members by virtue of the free-trade agreements each had signed with the Mercosur countries, and in 2003 Mercosur signed an economic complementation agreement with Colombia, Ecuador and Venezuela. In return, on 7 July 2005, the Andean Community's foreign ministers made Argentina, Brazil, Paraguay and Uruguay associate members of their own organisation. The present associates are:
- Chile, the first associate (1996). It has largely preferred bilateral trade deals, and Uruguayan politicians have at times urged their own country to follow its example.
- Peru, Colombia and Ecuador, the Andean Community members linked through the complementation agreements.
- Guyana and Suriname, the two English- and Dutch-speaking states of northern South America.
- Panama, the only associate outside South America.
With Bolivia's move up to full membership, every independent country in South America is now either a full member, an associate or, in Venezuela's case, a suspended member.
Trade Deals Beyond South America: Israel in 2007 to the EU in 2026
Outside the continent, Mercosur negotiates as one bloc because its members share a tariff. It signed free-trade agreements with Israel in December 2007, Egypt in August 2010, the State of Palestine in December 2011 and Lebanon on 18 December 2014. It concluded a deal with Singapore in November 2023 and with the European Free Trade Association in July 2025.
The largest agreement took more than a quarter of a century. Talks with the European Union began in 1999, stalled, revived in 2016, and produced a deal in principle announced on 28 June 2019 at the G20 summit in Osaka. Negotiations were concluded on 6 December 2024 at the Mercosur summit in Montevideo.
On 9 January 2026 a qualified majority of EU governments approved the deal by 21 votes to 5, with Austria, France, Hungary, Ireland and Poland against and Belgium abstaining, and it was signed on 17 January 2026 at the Central Bank of Paraguay in Asunción. On 21 January the European Parliament voted 334 to 324 to ask the European Court of Justice whether the deal could be applied before full ratification, but the agreement was provisionally applied from 1 May 2026. Once fully in force, both sides will cut duties on 91 to 92% of trade over 15 years, opening Europe to Mercosur beef, poultry, sugar and ethanol and opening Mercosur to European cars, machinery, wine and cheese. Canada and Mercosur resumed free-trade negotiations in 2026, and in November 2025 Brazil and the United Kingdom discussed opening formal talks between the UK and the bloc.
For the wider map of the continent, see our list of countries in South America; to compare Mercosur with its biggest trade partner, read what the European Union is, or visit the city where the bloc was founded in our guide to Asunción.