ASUNCIÓN, Paraguay – The European Union and the Mercosur bloc of South American countries formally signed a long-sought landmark free trade agreement Saturday, capping more than a quarter-century of torturous negotiations to strengthen commercial ties in the face of rising protectionism and trade tensions around the world.

The signing ceremony in Paraguay’s capital, Asunción, marks a major geopolitical victory for the EU in an age of American tariffs and surging Chinese exports, expanding the bloc’s foothold in a resource-rich region increasingly contested by Washington and Beijing.

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