EU member states will soon vote on a trade deal with the Mercosur bloc of Argentina, Brazil, Paraguay, and Uruguay after the European Commission announced new safeguards for farmers. The agreement would create a free-trade area of around 700 million people, the largest in the world.
France and Poland initially raised concerns about the impact of cheaper imports on their farmers, though French trade minister Laurent Saint-Martin said the Commission's proposed guarantees were a "step in the right direction." Polish Prime Minister Donald Tusk said his government would oppose the deal but acknowledged it would likely be approved: "If it becomes a reality, we will not rest until these defence mechanisms are in effect."
Germany has supported the agreement, with wholesale and foreign trade federation head Dirk Jandura urging Europe to act quickly: "In times of global uncertainty, Europe needs new partnerships." European Commission President Ursula von der Leyen said EU businesses and the agrifood sector would benefit from lower tariffs and costs, adding that "legally binding" safeguards had been put in place to reassure farmers.
EU trade chief Maros Sefcovic said the Commission aimed for approval by the end of 2025. Under the terms, Mercosur nations will gradually remove tariffs on 91% of EU goods, including cars, chemicals, wine, and chocolate. Cars currently face tariffs of 35%, and the Commission estimates EU exports could increase by €49 billion (US$53 billion) annually. In return, Mercosur will export products including meat, honey, sugar, and soybeans with fewer restrictions, as well as critical minerals.
The Commission said protections will include a mechanism to suspend Mercosur's preferential access to some farm products, such as beef, and a €6.3 billion (US$7.38 billion) crisis fund. Farmers have protested that imports fail to meet EU food safety and environmental standards, a claim the Commission rejects.
Copa-Cogeca, which represents Europe's agricultural sector, said the deal would be "economically and politically damaging for Europe's farmers, rural communities, and consumers." Italy has not declared a position, with Prime Minister Giorgia Meloni's office noting consultations were underway. CIA, Italy's farmers' confederation, said the deal could only benefit producers if safeguards for meat, sugar, and cereals were "truly swift and transparent."
German Chancellor Friedrich Merz welcomed the progress, stating the agreement "strengthens our economy in Germany and in Europe." The deal is seen by supporters as a way to reduce reliance on Chinese imports of raw materials like lithium while expanding EU export markets in the face of US tariffs.
Source: BBC