Montevideo (Brussels Morning Newspaper) – Commission President Ursula von der Leyen arrived in Latin America to finalize the EU-Mercosur trade deal, boosting trade and investment.
European Commission President Ursula von der Leyen arrived in Latin America to conclude a long-delayed trade agreement between the European Union and the South American Mercosur bloc. Ursula von der Leyen on his X handle said:
“The finish line of the EU-Mercosur agreement is in sight. Let’s work, let’s cross it. The largest trade and investment partnership the world has ever seen. Both regions will benefit.”
Touchdown in Latin America📍
— Ursula von der Leyen (@vonderleyen) December 5, 2024
The finish line of the EU-Mercosur agreement is in sight.
Let’s work, let’s cross it.
We have the chance to create a market of 700 million people.
The largest trade and investment partnership the world has ever seen.
Both regions will benefit.
Mercosur will sit in Montevideo amid indications the bloc of Argentina, Brazil, Paraguay and Uruguay will use the event to announce a deal on the trade deal, which would be the biggest struck by the European Union in terms of tariff reductions.
What are the main goals of the EU-Mercosur trade deal?
The trade agreement would reduce tariffs for most European Union exports to some of the biggest Latin American economies while extending the European market more to imports including agricultural products. It would also support the European footprint in a region where China has made inroads in recent years. It will be especially important for car exporters, who will notice the current 35% tariffs slowly removed over a number of years. High duties will be also stopped for other industrial products such as car parts, machinery, chemicals, clothing and textiles.
What challenges does the EU face in finalizing the Mercosur agreement?
The arrangement, which would create an integrated market of 780 million consumers, still confronts a very difficult procedure of ratification, as key member states including France and Poland have resisted the deal over environmental and regulatory concerns. European farmers have repeatedly protested against the deal, grumbling it will lead to cheap imports of South American commodities, notably beef, that is not subject to the same green and food safety measures as in the European Union.
France has been the loudest critic of the proposed contract but is distracted by a political crisis after the failure of French Prime Minister Michel Barnier’s short-lived administration. However, other EU members such as Germany press the EU-Mercosur deal is important for the bloc as it looks to diversify its trade after the near-closure of the Russian market and distress about its dependence on China. They also notice Mercosur as a potentially reliable source of crucial minerals, such as lithium, required for its green transition.
