EU, Mercosur aim to finalize trade deal by year's end amid ongoing disputes
(MENAFN) The European Union and the South American trade bloc Mercosur are working towards concluding their long-delayed trade agreement by the end of the year, having made significant strides in addressing previously contentious issues. The deal, which has been under negotiation for two decades, is seen as a crucial geopolitical and economic opportunity by EU officials. The European Union views this agreement as a strategic necessity, especially given the Mercosur bloc's status as an important market for European exports.
The proposed agreement, which would create a combined market of 780 million people, is expected to offer substantial economic benefits. European companies stand to save over €4 billion annually in customs duties, while existing European investments in Mercosur countries total €330 billion. The deal aims to enhance trade relations by eliminating tariffs and fostering closer economic ties between the two regions. Despite significant progress, the agreement has faced delays, particularly due to objections from France, which has expressed concerns about potential environmental impacts and competition with its agricultural sector.
French opposition, led by President Emmanuel Macron, has been a major hurdle, though it has only garnered limited support from Austria. This opposition has not been sufficient to halt the agreement, which requires approval from a majority of the EU's 27 member states. EU officials are now prepared to address these concerns, with a focus on ensuring that the agreement includes commitments to the Paris Agreement's climate goals. Countries like Germany and Spain have been strong advocates for the deal, which was tentatively agreed upon in 2019 but has remained in a state of limbo since then.
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