Head of the EU arrives in Uruguay to advance the trade agreement with Mercosur

European Commission President Ursula von der Leyen arrived in Uruguay on Thursday for the final stages of negotiations on a trade deal between the EU and the South American trading bloc Mercosur, which would create a transatlantic market worth some $700 million. people.

“The goal of the EU-Mercosur agreement is in sight. Let’s work, let’s cross it,” Von der Leyen said on Thursday, fending off objections from some EU member states like France and farmers’ protests across the bloc.

French President Emmanuel Macron, mindful of his country’s vocal and politically powerful farming community, has described what was on the table as “unacceptable.” If the deal with the South American bloc — made up of Brazil, Argentina, Paraguay, Uruguay and Bolivia — goes ahead, EU producers would have to compete with South American agricultural exports such as beef, poultry and sugar.

“We will continue to firmly defend our agricultural independence,” Macron said Thursday.

With the European Commission, the EU’s executive arm, negotiating trade deals for all 27 member states, von der Leyen could push ahead with a provisional agreement this weekend at the Mercosur summit in Uruguay, only to see it fail because one or more member countries refuse to sign it.

A preliminary agreement was announced in 2019, but disagreements over environmental, economic and political issues have delayed its final approval until now.

If the final differences are overcome, the EU-Mercosur agreement would encompass an economic zone that covers almost a quarter of the world’s GDP. It would focus on reducing tariffs and trade barriers and make it easier for companies on both sides to export goods.

Germany, with its enormous automotive industry, is a great defender of the agreement since it would make the sale of Volkswagens, Audis and BMWs much cheaper in Latin America.

Von der Leyen’s trip suggests that the technical problems between the EU and the South American bloc have been resolved and the way is open for “the highest political level to make the final concessions and commitments to try to close an agreement,” the spokesman said. the Commission, Olof Gill.

A massive protest movement by European farmers last year sent warning signals to negotiators, and on Thursday, Belgian farmers added their voice by blocking border crossings. They say Mercosur producers would be allowed to flood the market with products that do not have to meet the strict EU environmental and animal protection standards to which they must adhere, thus unfairly undermining the market. Additionally, they say South American producers benefit from lower labor costs and larger farms.

If Von der Leyen manages to clinch a deal, the Commission would still have to put it into legal text and it is until that stage that it would become clear whether certain or all parts need to be approved unanimously or whether a special majority among EU nations would be enough to finalize the agreement.

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