While the EU-MERCOSUR agreement is nearing its final stages, some remain opposed, risking a deadlock in the EU’s approval process. The EU must ensure smooth ratification to strengthen its strategic autonomy in these uncertain times.
After 25 years of complex negotiations, the European Union and MERCOSUR have finally reached a landmark trade agreement. Described as a historic milestone by European Commission President Ursula von der Leyen, this deal represents one of the most significant trade pacts ever negotiated by the EU. If ratified, it would establish the largest free trade zone in the world.
The timing of this agreement’s finalization does not come by chance. It coincides with a critical geopolitical moment for Europe, which, among other things, is actively working to diversify its exports. This is crucial as it helps reduce Europe’s dependency on a few dominant markets in a very uncertain global political landscape, ensuring greater economic resilience and security.
The EU’s trade relations with China are fragile, as recent tariffs on Chinese electric vehicles increase the risk of tensions with Beijing. Meanwhile, Donald Trump has warned the EU of potential tariffs on its exports to the US unless it increases its purchases of American oil and gas, escalating trade concerns with its biggest trading partner too.
However, it seems the deal is far from over, at least for the European Union, as it still needs to pass both the European Council and European Parliament to be effective. Some parties within the EU are not happy, especially France. Farmers in the EU have protested the deal, citing concerns over increased imports of beef, poultry, and sugar, which they fear could harm local production and lead to new competition. They also vowed to continue their resistance to the agreement.
But even if we do not look at the bigger picture to minimize the potential drawbacks the agreement might have, the facts show that most fears surrounding the agreement are unfounded, and the benefits significantly outweigh the potential disadvantages. Most importantly, it does not mean an unlimited influx of South American beef or similar products would flood the European market, potentially lowering prices and rendering local producers uncompetitive.
In fact, the agreement sets a cap of 99,000 tons of beef, carefully designed to protect European agriculture. The tariff-free quotas granted by Brussels to South America are relatively low, with beef, poultry, and sugar each accounting for between 1% and 2% of Europe’s annual consumption by volume, and rice below 1%. By balancing these interests, the EU can secure long-term benefits while addressing short-term concerns from the likes of France.
To further alleviate concerns, the EU included provisions to ensure the agreement respects environmental and social standards, aiming to prevent unfair competition and protect the livelihoods of European farmers while encouraging sustainable practices in MERCOSUR countries. It also opens up new opportunities for European exporters, especially in the automotive, machinery, and technology sectors, enhancing their market access in South America, which can lead to job creation and economic growth across the EU.
It is obvious that for the European Union, as a diverse bloc of 27 member states, each with its own unique economy and national interests, it is challenging to craft agreements that fully satisfy every member or group within the society. However, each national economy would be much weaker globally if left alone and it is undeniable that the EU’s collective economic strength by far surpasses that of its individual nations – even French agriculture. Ultimately, in this case, no deal would harm both the countries individually and the EU, while a unified deal benefits all.
The EU-MERCOSUR agreement exemplifies this principle. By embracing this deal, the EU can take a significant step toward achieving its vision of strategic global autonomy. Reducing dependency on dominant global markets like the United States and China is a key priority for the EU, and this agreement provides an opportunity to diversify partnerships by entering the market in South America and strengthening its economic foundations.
Given this international context with increasing global protectionism and economic instability, the deal with MERCOSUR comes at a crucial moment, enabling Europe to protect its economic interests and maintain its influence on the global stage. Member states must recognize this as an opportunity to strengthen both our economic foundations and role in shaping global standards.
Europe will benefit from expanded market access for European industries and deeper diplomatic ties with MERCOSUR countries. This would also mean enhanced global influence, economic resilience, and market leadership, making it more than just a trade agreement.
Written by Bojan Lazarevski – a political scientist in international and intercultural studies based in North Macedonia. Bojan is also a writing fellow with Young Voices Europe and an activist and researcher.