The text discusses a trade agreement between the EU and South America’s Mercosur bloc, highlighting the challenges the EU faces in gaining support from critics in Italy, France, Poland, and Hungary to finalize the deal by the year’s end. The agreement involves significant tariff cuts, where Mercosur will eliminate duties on 91% of EU exports like cars over 15 years, while the EU will reduce tariffs on 92% of Mercosur exports over up to 10 years. The deal also includes reduced tariffs on EU agricultural products, such as wines and spirits, and increased quotas for sensitive farm products, including a duty-free quota for beef and cheese.
Proponents, including Germany and Spain, argue the agreement reduces reliance on China for critical minerals and offers relief from tariffs imposed by the U. S. They claim it represents the largest tariff reduction deal the EU has ever negotiated, eliminating over 4 billion euros in annual duties and providing EU companies access to public contracts in Mercosur. The deal also acknowledges 350 geographic indications to protect traditional EU foods.
Critics, particularly European farmers, argue that the agreement may allow cheap South American imports that do not meet EU standards, compromising green and food safety regulations. They express concern over the potential for increased deforestation linked to Mercosur’s agricultural exports, calling the deal “climate-wrecking. ” France, as the largest EU beef producer, insists on protections for its farmers, while Italy, Hungary, and Poland also show opposition.
To win over skeptics, the EU Commission proposed a mechanism to suspend Mercosur’s access to sensitive farm products if imports increase beyond certain thresholds. The EU also plans to enhance production standards alignment, strengthen border controls, and establish a crisis fund for farmers in case the deal negatively impacts EU agricultural markets.
With information from Reuters
