Anticipating the strong protectionist winds that will blow from Donald Trump’s White House, the president of the European Commission, Ursula von der Leyen, has been responding by making her own economic weather. Last week, Ms von der Leyen flew to Montevideo, 5,000 miles south of Washington DC, to controversially conclude negotiations in one of the biggest free trade agreements in history. Twenty-five years in the making, the Mercosur trade deal opens up trade between the EU and a Latin American bloc of partners comprising Argentina, Brazil, Paraguay and Uruguay.
In theory, the agreement promises a more open market of 700 million people for products ranging from Argentine beef to German cars. For European manufacturers, it would eliminate tariffs on a majority of goods. As Mr Trump threatens to impose heavy tariffs on Chinese and European exports, here was evidence, asserted Ms von der Leyen, “that openness and cooperation are the true engines of progress and prosperity”.
