AP (BRUSSELS) Ursula von der Leyen, president of the European Commission, arrived in Uruguay on Thursday to begin the last stages of years-long negotiations to finalize a trade agreement between the 27-nation EU and the Mercosur trade bloc in South America. The agreement would establish a transatlantic market with 700 million people.
The agreement between the EU and Mercosur is almost complete. Von der Leyen said Thursday, eluding protests by farmers throughout the bloc and criticism from certain EU members including France, “Let’s work, let’s cross it.”
Aware of his nation’s vociferous and influential farming community, French President Emmanuel Macron has called what was on the table intolerable. EU producers would have to contend with South American agricultural exports including cattle, chicken, and sugar if the agreement with the South American bloc—which consists of Brazil, Argentina, Paraguay, Uruguay, and Bolivia—goes forward.
Macron declared on Thursday that he will “continue to steadfastly defend our agricultural independence.”
Von der Leyen may proceed with a provisional agreement this weekend at the Mercosur summit in Uruguay, but it may fail because one or more member states would not sign it. This is because the EU Commission negotiates trade deals for all 27 member states.
Disagreements over political, economic, and environmental concerns have delayed the final approval of a draft agreement that was announced in 2019.
The EU-Mercosur agreement would cover an economic region that accounts for about 25% of the world’s GDP if the remaining disagreements are resolved. Its main goal would be to lower trade restrictions and taxes, which would facilitate exporting for companies on both sides.
With its massive automobile sector, Germany is a strong supporter of the agreement since it would make selling Volkswagens, Audis, and BMWs throughout Latin America considerably simpler and less expensive.
According to Commission spokesperson Olof Gill, von der Leyen’s visit indicated that “technical issues between the EU and the South American bloc were settled and the road was open for the top political level to make the final compromises to try to get a deal over the line.”
Negotiators received warning shots from a large-scale European farmers’ protest movement last year, and Belgian farmers’ protests on Thursday gave their voice by obstructing border crossings. They claim that Mercosur producers would unjustly undercut the market by flooding the market with produce that does not have to adhere to the stringent EU environmental and animal protection criteria. Additionally, they claim that larger farms and cheaper labor costs favor South American growers.
Even if von der Leyen closes a deal, the Commission would still need to draft legislative language before it would be apparent if a special majority of EU countries would be enough to seal the accord or if some or all of the provisions would require unanimous approval.
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From Paris, Tom Nouvian made a contribution.
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