European Commission President Ursula von der Leyen gives a statement, next to European Council President Antonio Costa, at the presidential palace in Baabda, Lebanon, on Friday.Mohamed Azakir/Reuters
EU nations are expected on Friday to approve the signing of the bloc’s largest-ever free-trade accord with South American group Mercosur, over 25 years since negotiations began and after months of wrangling to secure key member states’ backing.
The European Commission, which concluded negotiations a year ago, and countries such as Germany and Spain argue it is a vital part of an EU push to unlock new markets to offset business lost from U.S. tariffs and to reduce reliance on China by securing access to critical minerals.
Opponents led by France, the European Union’s largest agricultural producer, say the agreement will jack up imports of cheap food products, including beef, poultry and sugar, undercutting domestic farmers. Farmers have launched protests across the EU, blockading French roads on Thursday.
Farmers drive tractors through Paris, block highways in Greece to protest Mercosur free-trade deal
Ambassadors from the EU’s 27 member states are due to indicate their governments’ positions on Friday, with 15 countries representing 65 per cent of the bloc’s total population required for approval. EU capitals would then give written confirmation later on Friday or on Monday.
This will clear the way for Commission President Ursula von der Leyen to sign the agreement with Mercosur partners - Argentina, Brazil, Paraguay and Uruguay. The European Parliament will also need to approve the accord before it can enter force.
A tractor is parked in front of France's National Assembly, as French farmers protest against the the EU-Mercosur free trade agreement on Thursday.Benoit Tessier/Reuters
France says the battle is not over
The free-trade agreement would be the European Union’s biggest in terms of tariff reduction, removing €4-billion (US$4.66-billion) of duties on its exports. The Mercosur countries have high tariffs, such as 35 per cent on car parts, 28 per cent on dairy products and 27 per cent on wines.
The EU and Mercosur will hope to expand evenly split goods trade worth €111-billion in 2024. EU exports are dominated by machinery, chemicals and transport equipment, and Mercosur’s are focused on agricultural products, minerals, pulp and paper.
To win over deal skeptics, the European Commission has put in place safeguards that can suspend imports of sensitive farm produce. It has strengthened import controls, notably regarding pesticide residues, established a crisis fund, accelerated support for farmers, and has pledged to cut import duties on fertilizers.
France will vote against Mercosur trade deal after farmers protest in Paris, Macron says
The concessions were not enough to win over Poland or France, but Italy appears to have shifted from a ’no’ in December to a ’yes’ on Friday.
French Agriculture Minister Annie Genevard has said the battle is not over and has pledged to fight for a rejection by the EU assembly, where the vote could be tight. European environmental groups also oppose the accord, with Friends of the Earth calling it a “climate-wrecking” deal.
German Social Democrat Bernd Lange, the chair of parliament’s trade committee, expressed confidence that the deal would be passed, with a final vote most likely in April or May.