The EU-Mercosur agreement will open huge opportunities for trade expansion to both sides, as well as giving the EU geopolitical leverage over Mercosur, in regards to environmental protection and climate change. It is based on the premise that trade should promote sustainable development. In line with the model of trade agreements imposed in recent years, the treaty includes provisions for safeguarding the environment and labour standards. EU firms will be the first non-Mercosur business to have access to these processes. Hitherto, Mercosur countries have not allowed third country’s access to their public tenders. Both sides will simplify their customs procedures and strengthen their collaboration on standards and technical regulations, offering greater legal certainty and a level playing field.įurthermore, the treaty upholds the liberalisation of public procurement processers by both parties. To facilitate trade in services, which is expected to grow faster in the post covid-19 world, the Agreement has included provisions that reduce non-tariff barriers.
To protect European farmers, 357 traditional European products recognised with Geographical Indicators (GI) will be protected against counterfeit products in the South American countries. In return, the EU will exempt duties on 95% of goods imported from Mercosur, along with 83% of agricultural imports. Under the Agreement, Mercosur will remove tariffs on 91% of the goods imported from the EU, including key exports such as vehicles (35%) and machinery.
It envisages the removal of trade tariffs between the two areas, as well as including provisions that facilitate trade in services and the liberalisation of public procurement processes. The EU-Mercosur Agreement is the EU’s largest trade agreement, expecting to boost bilateral trade and economic integration between the two regions. Moreover, if missed, China’s political and economic influence in Mercosur, which has shown a blatant disregard for sustainable development, looks likely to continue its unbridled growth. The agreement offers the EU a unique opportunity to have a positive impact on sustainable development in the South American region. The EU should not let 20 years of negotiations with the South American bloc go to waste, not only because it will boost trade expansion on both sides, but also because of its geopolitical strategic value. Several member states seem reluctant to move forward, due to opposition from European farmers, who fear unfair competition, and environmentalists, concerned with the risk of higher deforestation of the Amazon. However, progress has been on hold for almost two years. The Trade Agreement is undergoing a legal review and must be approved by European Parliament and national Parliaments of the four Mercosur countries, before starting the implementation process. The awaited agreement is set to strengthen trade and political ties, as well as being an opportunity for the European Union to reassert its position on the international stage by reinforcing rules-based trade. On the 28 th of June 2019, after two decades of negotiation, a historic trade agreement was struck between the European Union (EU) and the Mercosur trading bloc (Argentina, Brazil, Paraguay, and Uruguay). In front: Phil Hogan, Cecilia Malmström and Jorge Marcelo Faurie.
Joint press conference on EU-Mercosur trade negotiations ().
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