PARANA, Argentina — At a Dec. 16 summit in Parana, Argentina, Lebanon signed a memorandum of understanding with Mercosur. Although news of the signing seems ordinary, it carries underlying significance for Lebanon.

Mercosur promotes free trade in South America. Established in 1991, it has five member states — Argentina, Brazil, Uruguay, Paraguay and Venezuela. Negotiations are currently underway for Bolivia, Chile, Colombia, Ecuador and Peru to join the organization. Al-Monitor received a copy of the file prepared by the Lebanese Foreign Ministry for the delegation attending the summit, outlining the following figures and details.

The area covered by Mercosur exceeds 12 million square kilometers (4.6 million square miles), and its member states are home to more than 450 million people. The gross domestic product (GDP) of these states is estimated at $5.7 trillion. On the other hand, Lebanon, small and situated on the Mediterranean, covers 10,452 square kilometers (4,036 square miles), has a population estimated at 4 million and a GDP of around $40 billion. What are the common interests that encouraged the two sides to expedite Lebanon's entering into agreement with the large South American market 12,500 kilometers (7,767 miles) away? What motivated the festive approval of the agreement among the states at the Parana summit, during which Mercosur also entered into a similar economic agreement with Tunisia.

Regarding economic feasibility, officials in the Lebanese delegation told Al-Monitor that the commercial figures alone are not enough to explain the agreement. Exports from the Mercosur states to Lebanon are estimated at around $560 million per year. These figures are low relative to Lebanese imports, around $21 billion per year, accounting for less than 2.7% of total Lebanese imports.