The deal has provoked farmers’ protests in several countries, including France (Damien MEYER)
The EU gave Friday a long-delayed go ahead to a huge trade deal with South American bloc Mercosur championed by business groups but loathed by many European farmers — overriding opposition led by France.
A majority of the European Union’s 27 nations backed the pact at an ambassadors’ meeting in Brussels, diplomatic sources told AFP, paving the way for it to be inked in Paraguay next week.
More than 25 years in the making, supporters see the deal as crucial to boost exports, support the continent’s ailing economy and foster diplomatic ties at a time of global uncertainty.
German Chancellor Friedrich Merz hailed the agreement.
“The approval of the EU-Mercosur Agreement is a milestone in European trade policy and an important signal of our strategic sovereignty and capacity to act,” the German leader said.
But the European Commission, which negotiated the text, failed to win over all of the bloc’s member states.
Key power France, where politicians across the divide are up in arms against a deal attacked as an assault on the country’s influential farming sector, led an ultimately unsuccessful push to sink it.
Ireland, Poland, Hungary and Austria also voted against the accord.
But that was not enough to block it, after Italy, which had demanded and obtained a last-minute delay in December, threw its weight behind the pact.
– ‘Economic clout’ –
The deal will create a vast market of more than 700 million people, making it one of the world’s largest free trade areas.
Part of a broader push to diversify trade in the face of US tariffs, it will bring the 27-nation EU closer together with Brazil, Paraguay, Argentina and Uruguay, removing import tariffs on more than 90 percent of products.
This will save EU businesses four billion euros ($4.6 billion) worth of duties per year and help exports of vehicles, machinery, wines and spirits to Latin America, according to the EU.
It will also help the bloc reduce its dependency on China for critical raw materials, said Agathe Demarais, of the European Council on Foreign Relations, a think tank.
“The conclusion of the EU-Mercosur trade deal is great news for Europe’s global geopolitical and economic clout,” she said, describing it one of the “best responses to US tariffs, growing protectionism and trade tensions with China.”
Germany, Spain and others were strongly in favour, believing the deal will provide a welcome boost to their industries hampered by Chinese competition and tariffs in the United States.
But France and other critics opposed it over concerns that their farmers would be undercut by a flow of cheaper goods, including meat, sugar, rice, honey and soybean, from agricultural giant Brazil and its neighbours.