The much-discussed trade agreement between the European Union and the South American trading bloc Mercosur partially entered into force on Friday. This will immediately eliminate high import duties for products such as wine and cheeses from France and Italy, Brazil, Argentina, Paraguay and Uruguay, among others. A rate reduction of 10 to 17.5 percentage points will be applied to (electric) cars. There will also be (phased) reductions on many components of industrial products and pharmaceutical products, and customs rules have been relaxed.
The signatories, including European Commission President Ursula von der Leyen and Brazilian President Lula da Silva, are celebrating the agreement as a victory for multilateralism and a counterbalance to the unilateral trade policy of the US Trump administration, which has imposed high import duties on many countries.
By activating the Mercosur agreement, which came into effect after more than 25 years of negotiations, Von der Leyen has caused bad blood among a majority of the European Parliament. Although sufficient EU countries agreed to the trade agreement, a majority of MEPs decided not to agree to it at the end of January. The European Parliament wanted to first have the text assessed by the European Court of Justice, a process that could take two years.
However, the Commission decided to settle the ‘endless Mercosur saga’, among other things now-or-never-busy from Brazil. MEPs label the provisional entry into force as an “anti-democratic decision”. “We must not hand over our strategic instruments,” said BBB MEP Jessika van Leeuwen.
Van Leeuwen is particularly concerned about the rules for import quotas in “sensitive sectors such as beef or poultry”, leaving quota management in the hands of the Mercosur countries. Belgian MEP Benoît Cassart, member of the liberal Renew group, has sent a letter to the Commission about this.
Commission President Von der Leyen believes above all in the benefits of opening up the trade markets, she writes on X: “The provisional application will demonstrate the concrete benefits of the agreement and show how legitimate concerns have been addressed.”
The free trade agreement between the European Union and the trading bloc of Brazil, Argentina, Paraguay and Uruguay covers a market of 720 million consumers, including 450 million Europeans.
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Mercosur trade agreement partly in force, but still subject to political and legal battles
