EU seeks to win over opponents of Mercosur trade deal

Farm organisations in Ireland have criticised the deal.

The European Commission presented an EU trade accord with South America's Mercosur bloc for approval today, hoping to win over the main critics of the deal - France, Poland and European farmers including in Ireland - with promises of safeguards.

The European Union and the bloc of Argentina, Brazil, Paraguay and Uruguay reached the free trade agreement last December, some 25 years after negotiations were launched.

Now it will be put up for consent in the European Union, requiring a vote in the European Parliament and a qualified majority among EU governments, meaning 15 of 27 members representing 65% of the EU population. Neither is a given.

The Commission and proponents such as Germany and Spain say the Mercosur deal offers a way to offset the loss of trade due to tariffs imposed by US President Donald Trump and to reduce reliance on China, notably for critical minerals.

France, the EU's largest beef producer, has previously branded the deal "unacceptable", while Poland, another farming heavyweight, has repeatedly expressed its opposition.

He said the situation would have Irish farmers producing beef subject to the most stringent sustainability and environmental regulations that would sit side-by-side on European supermarket shelves with cheaper South American beef produced to notably lower standards of regulation, health and traceability on ex-forest land.  

Mr. Drennan called on the Irish Government to make a united case with other Member States – most specifically, France – and form a blocking element that will halt any ratification process.

Hoping to offset their concerns, the Commission will propose a mechanism whereby preferential Mercosur access for sensitive farm products such as beef could be suspended if the imported market share or volumes rose by 10% or prices fell by that amount, a European official said.

Polish Prime Minister Donald Tusk said on Wednesday that his country continued to oppose the deal, but no longer had other partners to block it. It was then essential to have such a defence measure in place, he said.

The EU executive has said the Mercosur agreement is the largest it has ever agreed in terms of tariff reductions and is a necessary part of the EU's push to diversify trade ties.

Since Trump's re-election last November, the EU has gone into overdrive in seeking trade alliances, accelerating talks with India, Indonesia and the United Arab Emirates and deepening ties with existing free trade partners Britain, Canada and Japan.

The Commission will also present an updated EU-Mexico agreement, struck in January, on Wednesday.

European farmers have repeatedly protested over the Mercosur deal, saying it would lead to cheap imports of South American commodities, notably beef, that do not meet the EU's green and food safety standards. The Commission has denied this is the case.

European green groups also oppose the accord. Friends of the Earth has called it a "climate-wrecking" deal.

They hope it will be blocked, either in the parliament, where the Greens and far right are critics, or by EU governments. However it now appears that there will not be a large enough group of governments to reject the deal.

EU proponents of the deal see Mercosur as a growing market for European cars, machinery and chemicals and a reliable source of critical minerals for its green transition, such as battery metal lithium, for which Europe is now dependent on China.

They also point to agricultural benefits, given the deal would offer greater access and lower tariffs for EU cheeses, ham and wine.

Reuters