Brazil wants to reduce certain trade barriers by ending a four-decade-old maritime transportation agreement with Chile. The Brazilian government will hold a meeting on July 25 to evaluate the timeline of terminating the agreement (which can only be done by presidential decree). Under the agreement, only one company from Brazil and one from Chile are responsible for the maritime trade between the countries. Ending this maritime transportation monopoly would help Brazil accommodate EU interests in the trade negotiations with the Common Market of the South, or Mercosur, as well as reduce Brazil's maritime transportation cost.

Mercosur has been pushing for the conclusion of trade negotiations with the European Union, but the bloc's major economies must first take steps towards trade liberalization. Some EU countries, however, are reluctant to open up their markets to Mercosur's agricultural products, beef in particular. Mercosur, meanwhile, has been willing to make a more attractive offer to Europe in exchange for liberalizing the agricultural trade. In the last week, Brazil gave signs that it will lift trade barriers to EU dairy and fruit products, as well as allow the participation of European companies in the country's service sector.

Another reason to end the monopoly over Brazil-Chile maritime trade is to reduce transportation costs. According to the Brazilian National Confederation of Industries, the cost of maritime transportation between the two countries is 45 percent more because of the agreement. This increases the final price of products in Brazil and Chile, between which trade reached $7 billion last year.

Brazil is becoming more open to trade and is eager to speed up negotiations with other individual countries and economic blocs. The possibility of removing a four-decade monopoly in the maritime transportation business with Chile is part of the Brazilian government's broader package of reforms to encourage further economic development.