European Union and Mercosur Strike a Deal with Free Trade Agreement

After 25 years of negotiating, the European Union and Mercosur countries (Argentina, Bolivia (newly), Brazil, Paraguay, and Uruguay) have established terms for a Free Trade Agreement. Proponents of the deal claim it will save $4.26 billion in duties each year – highlighted products include Italian wine, Argentine steak, and German Volkswagens.  

Although terms have been established, some EU countries are not quite ready to accept the new onslaught of Brazilian steakhouses. Several EU countries, most notably France, the Netherlands, and other countries with booming beef and dairy industries say that this alliance will cause environmental damage, due to the unfair competition local farmers will soon have to compete with.  

Other growing concerns for EU citizens are that the Mercosur countries do not currently have the same level of regulation regarding animal treatment and pesticide use, which is a large selling point of localized farming in the EU.  

Some of the environmental concerns have already been addressed in a recent amendment titled Paris Agreement as an essential element; however, it has obviously not met the standards of the concerned parties, as they continue to rally to block the deal. European Commission President Ursula von der Leyen has also addressed concerns, noting “We have heard you, listened to your concerns, and we are acting on them.”  

While the proponents push to have the agreement endorsed by EU Parliament, France is actively assembling allies to block the agreement. In order for the agreement to be blocked, at least 3 other EU member states must formally align with France. If it is blocked, negotiations will likely continue on - potentially for another quarter-century.  

For additional information on what the future holds regarding EU – Mercosur Free Trade Agreements or any other global Free Trade Agreements, please reach out to Allyn International at sales@allynintl.com or 239-489-9900. 

Contributor: Audrey Silcox

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