The European Union has signed the controversial trade agreement with Mercosur, the South American trade bloc, hailing it as a historic milestone creating exports, growth and jobs.
Welcoming the Partnership Agreement (EMPA) and Interim Trade Agreement (iTA), European Commission president Ursula von der Leyen said the regions were opening “a new chapter of opportunity for more than 700 million citizens. With this win-win partnership, we both stand to gain – economically, diplomatically and geopolitically. Our companies will create exports, growth and jobs. We will support each other in our clean and digital transitions. And our signal to the rest of the world is clear: the EU and Mercosur are choosing cooperation over competition, and partnership over polarisation.”
The agreement with Mercosur – full members Argentina, Bolivia, Brazil, Paraguay and Uruguay – will create one of the biggest trade zones in the world and deliver substantial new commercial opportunities for companies across the EU, according to the Commission, driving an estimated 39% increase in annual exports to Mercosur (a value of approximately €49 billion), while supporting hundreds of thousands of EU jobs.
For European business, the agreement will remove tariffs on EU exports, including agri-food and key industrial products such as cars, machinery, and pharmaceuticals, saving EU businesses €4 billion worth of duties per year; make it easier to invest in key supply chains, including critical raw materials and related goods; strengthen economic security and supporting the digital and green transitions on both sides; and help the EU and Mercosur to shape global trade rules in line with the highest EU standards.
Responding to concerns from Europe’s farming community, the Commission says the deal opens unprecedented access to the Mercosur region for European farmers and food producers, and is expected to increase EU agri-food exports to Mercosur by up to 50%. It will reduce tariffs on key EU agri-food products, such as wine, spirits, dairy, and olive oil; and protect 344 EU Geographical Indications, high-value traditional food and drink products, from unfair competition and imitation.
At the same time, the Commission says sensitive agri-food sectors will benefit from every necessary protection, by carefully calibrating tariff rate quotas that limit market access of sensitive products imported from Mercosur; a legally binding safeguard mechanism that protects sensitive European products in case of a surge in imports from Mercosur countries; enhanced controls preventing non-compliant products from entering the EU market, including more audits and checks in third countries, and strengthened controls at EU borders; actions to operationalise the commitment in the EU’s Vision for Agriculture and Food, for a stronger alignment of production standards, such as pesticides and animal welfare, applied to imported products; and a €6.3 billion fund, the Unity Safety net as from 2028, as an additional layer of protection for our farmers in case of market disturbances.
Regarding sustainability, the agreement features enforceable commitments on climate action, including the Paris Agreement as an essential element; commitments on sustainable development, including on women’s economic empowerment and labour rights; a pledge to work towards climate neutrality by 2050; and a clear contribution for trade to the green transition.
Following signature, the EU and Mercosur now need to follow their respective procedures to work towards ratification of the Agreement.
Reinforced controls on products imported into the EU – press release
EU-Mercosur Agreement In Focus
Factsheet Key facts about the agreement
