History occasionally creates unlikely winners—not because they planned everything correctly, but because the world changes around them and suddenly makes their geography, capabilities and relationships far more valuable. Central and Eastern Europe and Mercosur may be two such regions.
Calling them ‘darlings of history’ sounds paradoxical—and deliberately so. History has rarely treated either region kindly. CEE spent much of the twentieth century caught between empires, wars, occupations and imposed political systems; South America knows its own long story of instability, military rule and economic crisis. Neither has had the luxury of assuming history would work in its favour. But history is rarely linear. Periods of disruption open windows in which regions once considered peripheral become central to the calculations of much larger powers. This is one of those moments.
What makes CEE and Mercosur temporary darlings of history is not that their problems have vanished—they plainly have not. It is that other powerful actors increasingly need what they have. Washington, Brussels and Beijing are paying more attention to South America; the United States, Western Europe and NATO to Europe’s eastern half. Capital, security, energy, food, minerals, industrial capacity and geography are all being repriced. Attention is not prosperity. But attention creates leverage, and leverage, used well, creates opportunity.
History can punish geography—then reprice it
For decades, CEE was defined by what it was becoming: Western, democratic, capitalist, European. Its model was convergence: attract investment, plug into Western supply chains, access the Single Market, close the income gap. It worked remarkably well. Now the region is entering a different phase. Poland is becoming one of Europe’s consequential powers, Romania has sharply increased its economic weight, Czechia remains a formidable industrial economy, the Baltics have built real technological depth, and defence spending is opening another industrial frontier. Then there is Ukraine: whatever the eventual settlement, its reconstruction will be one of Europe’s largest economic undertakings in decades, turning Poland, Romania, Slovakia and their neighbours into logistics, manufacturing and capital platforms. CEE is moving from Europe’s convergence zone towards one of its strategic centres of gravity.
This is not an escape from history. War has returned to the neighbourhood, demographic pressures are severe, and institutions remain uneven. But the same geography that once made CEE vulnerable now makes it valuable. That is the paradox. History can punish geography, then reprice it.
Mercosur is living through its own repricing. Brazil is at once an agricultural superpower, an energy player, an industrial economy and a diplomatic heavyweight; Argentina holds extraordinary agricultural, energy and mineral potential; Uruguay and Paraguay bring their own advantages to a bloc increasingly courted by larger powers. Here too, history has hardly been gentle. But the new international system suddenly assigns great value to what Mercosur has in abundance—food, energy, critical minerals, renewable potential, large consumer markets and, above all, geopolitical optionality. China wants more from South America. Washington is refocusing on its hemisphere. And Europe has finally concluded a deal it pursued for more than a quarter-century. When everybody needs optionality, the countries able to work with several centres of power become more valuable.
That is why I call both regions darlings of history—not because history has favoured them, but because it has temporarily placed both closer to the centre of other people’s strategies. The challenge is to convert attention into agency before the window shifts again.
The agreement changes the map
The EU–Mercosur agreement is far more than another trade deal. A political agreement was reached in December 2024; the partnership and interim trade agreements were formally signed in January 2026, and the interim trade agreement has applied provisionally since 1 May 2026. Together, the agreements are intended to create what EU institutions describe as the world’s largest free-trade area, covering more than 700 million consumers and over one-fifth of global GDP. EU–Mercosur trade in goods totalled about 109 billion euros in 2025, with tens of billions more in services.
But headline figures mislead. ‘EU–Mercosur trade’ does not mean every part of Europe trades equally with every part of Mercosur. Economic geography has memory. Spain and Portugal enjoy obvious linguistic and historical advantages in Latin America; Italy has deep human ties; France and Germany have decades of corporate experience across the continent. CEE starts elsewhere. For most of the last 35 years, its companies had little reason to look across the South Atlantic—they had a transformation to finish at home. That is now changing. And that is where the real opportunity begins.
Two regions, one two-way discovery
For South American executives, ‘Europe’ has long meant Madrid, Lisbon, Paris, London, Frankfurt, Milan. There were good reasons—capital, language, diaspora, established multinationals. But twenty-first-century Europe has a different map. Warsaw matters more. Bucharest matters more. Prague matters more. The Baltic, Black Sea and Adriatic corridors matter more; the eastern flank matters enormously for security and energy; and Ukraine’s reconstruction will pull economic gravity further east. Mercosur companies should start seeing CEE not as Europe’s distant periphery but as an alternative gateway into Europe’s next growth geography—in food and agritech, energy, critical minerals, aerospace, defence, mobility, digital services, logistics and industrial technology, areas in which the two regions are genuinely complementary.
The discovery has to run the other way too. CEE’s first globalisation was inbound: foreign capital came to us, Western firms built factories, global corporations opened service centres. The region became exceptionally good at participating in other people’s internationalisation. The next stage must be outbound. Polish, Czech, Romanian, Hungarian, Baltic and other companies increasingly need to buy, build and partner abroad—partly as a matter of ambition and partly as a matter of mathematics, as domestic markets and demographics impose limits. Latin America belongs on that map. For Romania, there is an added edge I have called the ‘Latin network’: using cultural and linguistic affinity with Europe’s Latin economies and with Latin America as an additional form of infrastructure for internationalisation. Romania is at once Central European, European and Latin. That identity has been more cultural than commercial. It does not have to stay that way.
Competitive connectivity, not a new patron
The timing is favourable for a deeper reason: the Western Hemisphere is strategically competitive again. Washington’s renewed focus on its neighbourhood—the ‘Donroe’ Doctrine—is changing Latin American calculations, as China’s presence already has. This should not be read through Cold War logic, in which South America must pick one patron. The more interesting future is competitive connectivity. Washington offers security, capital and proximity; China offers scale, infrastructure and demand; Europe offers a vast market, investment, technology and standards. Mercosur’s opportunity is to avoid dependence by keeping all three relationships alive. The EU–Mercosur deal strengthens the European leg of that triangle—and produces a second-order effect that deserves far more attention. Brussels has not only connected Mercosur with Western Europe. It has connected Mercosur with CEE. That is a much newer relationship.
The reinvention corridor
Here the story becomes one of reinvention. Mercosur is evolving from a regional arrangement discussed mostly in terms of commodities into a more consequential platform in global competition. CEE is evolving from a low-cost convergence region into a strategic European centre for industry, technology, defence, energy and reconstruction. And the EU itself is being forced to reinvent its global economic role. I argued previously in Reinvantage that Europe has quietly assembled an impressive architecture of trade agreements but now needs companies willing to walk through the doors Brussels has opened. EU–Mercosur is the perfect test—because reinvention is often less about acquiring new capabilities than about connecting old ones to opportunities that did not exist before.
Picture a new Reinvention Corridor: South America across the Atlantic into CEE and onwards to Ukraine and Europe’s eastern neighbourhood—and, in reverse, CEE through the EU–Mercosur framework into South America’s large markets and the wider Latin American economy. The corridor does not yet exist at scale. That is precisely why it is interesting. Reinvention is most valuable before everyone else sees the opportunity.
Treaties do not create trade; companies do, and Europe has repeatedly shown that signing a deal and exploiting it are different skills. This relationship needs infrastructure beneath the agreement: business missions, chambers and councils, cross-Atlantic investment funds, CEO networks, university and technology partnerships, direct flights, stronger Spanish- and Portuguese-language capabilities inside CEE firms and more CEE expertise inside South American ones—and, above all, corporate curiosity. A Brazilian CEO weighing Europe should have Warsaw and Bucharest on the map beside Madrid and Frankfurt; a Polish, Czech or Romanian CEO thinking globally should have São Paulo, Buenos Aires and Montevideo beside New York, London and Dubai. The relationship becomes real when those cities enter each other’s boardrooms.
Agriculture will be the obvious obstacle—and CEE farmers have legitimate concerns about competition and standards that should not be dismissed. But agriculture need not define the relationship; it could become one of its most interesting frontiers. CEE has land, farming traditions and a growing agritech sector; Brazil and Argentina are home to some of the world’s most sophisticated large-scale agricultural systems. The question is not only who sells more into Europe, but what these two agricultural regions can build together—in precision farming, biotech, food processing, machinery, climate resilience and digital farm management. I previously wrote on Reinvantage that the future of agriculture will increasingly be found where soil meets code. This is a remarkable laboratory for exactly that.
Attention is an asset—but a depreciating one
There is a warning inside the phrase ‘darlings of history’. History keeps favourites only briefly. Today’s indispensable geography can become tomorrow’s forgotten periphery; today’s commodity edge can be disrupted; today’s attention can move on. Both regions should treat this moment not as validation but as a window—and convert geopolitical attention into economic infrastructure before it closes: trade routes, investment relationships, acquisitions, research partnerships, supply chains and personal ties between CEOs. Those things survive headlines. It is the deeper lesson of both regions’ difficult histories: opportunity is rarely permanent, but institutions can make more of its benefits permanent.
CEE–Mercosur trade will not suddenly rival either region’s largest partnerships, and no one should invent artificial targets. The opportunity is subtler. Two regions whose relevance is rising are discovering each other exactly when the system rewards diversification. Mercosur wants options; CEE needs markets. Mercosur companies need new gateways into Europe; CEE companies need to learn how to globalise outwards. The pieces increasingly fit.
For 35 years, CEE’s story was about connecting east to west; for Mercosur, this century has been about balancing north, west and east. The next map can be more imaginative. Southwest can meet northeast. Brussels has built the bridge, great-power competition has created the incentive, Ukraine’s reconstruction will raise CEE’s gravity, and the world’s rediscovery of South America will raise Mercosur’s. History has not suddenly turned kind to either region. It has done something more useful: made both more relevant to the ambitions of others. That relevance creates attention, attention creates leverage, and leverage opens a window for agency. Now business has to turn that window into relationships that outlast the moment. The next chapter of globalisation may not be written only between the world’s traditional centres. It may be written between its newly central regions. CEE and Mercosur have spent decades looking elsewhere. Their next reinvention should be to look at each other.
Photo: Dreamstime.
