EU-Mercosur Trade Deal Faces Opposition From European Farmers

Farmers block a highway to protest the EU-Mercosur trade agreement, Monday, Nov. 18, 2024 in Velizy-Villacoublay outside Paris. (AP Photo/Christophe Ena)

After more than two decades of negotiations, the European Union and Mercosur are still working to finalize a major trade agreement that aims to create one of the largest free trade zones in the world. This agreement would cover over 700 million people and nearly 25% of global GDP, similar to the U.S.-Mexico-Canada free trade agreement.

The deal seeks to reduce tariffs and trade barriers, making it easier for businesses on both sides to export goods. For the EU, the agreement would result in lower tariffs on products like cars, machinery, and chemicals. On the other hand, Mercosur countries would gain better access to EU markets for agricultural exports such as beef, poultry, and sugar.

However, the agreement faces significant opposition, particularly from European farmers, especially in France. They fear that an influx of South American products would saturate their markets, undercutting local agriculture. Livestock farmers argue that they cannot compete with South American producers who benefit from lower labor costs, larger farms, and less stringent regulations.

Deal would cover over 700 million people and nearly 25% of global GDP.

EU-Mercosur trade agreement aims to reduce tariffs and trade barriers.

EU would lower tariffs on cars, machinery, and chemicals.

Support for the deal comes from countries like Germany, Spain, Italy, and Portugal within the EU, as well as leaders in South America such as Brazilian President Luiz Inácio Lula da Silva. Industries in both regions, including European carmakers and pharmaceutical companies, see the agreement as a way to access new markets.

Opposition to the deal is led by France, along with Poland, Austria, and the Netherlands within the EU. French President Emmanuel Macron has called for stronger environmental and labor standards, expressing concerns about the current agreement. Environmental groups like Greenpeace have also criticized the deal, warning about potential impacts on the Amazon and increased pesticide use.

The upcoming Mercosur summit in Uruguay could be a crucial moment for the deal. Even if the agreement is signed, it must be ratified by all 27 EU member states, the European Parliament, and national parliaments. To facilitate approval, the European Commission is considering splitting the deal into two parts, with a trade-focused agreement requiring a majority vote under EU rules.