trade
Struggle for the EU-Mercosur deal: the new target is the end of 2023
EU Commission President Ursula von der Leyen welcomes Brazilian President Luiz Inácio Lula da Silva in Brussels. photo
© Geert Vanden Wijngaert/AP/dpa
The negotiations about one of the largest free trade zones in the world could gain new impetus. The countries are in favor of a speedy agreement. But one thing is also clear: it will be difficult.
Efforts to conclude the Free Trade Agreement between the The EU and the South American economic community Mercosur are picking up speed again. At the summit of the EU and the Community of South American and Caribbean States in Brussels, Brazilian President Luiz Inácio Lula da Silva and the current Spanish EU Council Presidency expressed their hope of being able to conclude an agreement in the next six months.
Chancellor Olaf Scholz was also optimistic before the start of the summit: “I am very happy that things are still the same, that many of the Latin American countries are very committed to the fact that we will soon be able to achieve a good result,” he said at the start of the summit summit in Brussels. “I am convinced that we will succeed.”
After years of negotiations, a basic political agreement was reached in the summer of 2019 on the establishment of the free trade area between the EU and the Mercosur states of Brazil, Argentina, Uruguay and Paraguay. However, the deal is now being questioned again by several EU countries such as France and Austria. Critics fear that European farmers will be forced into a price war in future and that the destruction of rainforests in South America will be fueled at the same time.
So far, however, the South Americans have not wanted to accept proposals for an additional declaration. Negotiations on a compromise are currently underway. Lula recently called for concessions for stronger protection for smaller Brazilian companies in public tenders, as he expects particularly strong economic growth in this area.
During the tenure of his right-wing populist predecessor Jair Bolsonaro, there had recently been little progress. In the EU, his policies were made jointly responsible for the devastating fires in the Amazon rainforest. After fires in the summer of 2019, French President Emmanuel Macron announced that he would reject the free trade agreement that had already been negotiated.
Different poses
A few months later, the responsible members of the Austrian Parliament in Vienna also voted against the agreement. Chancellor Karl Nehammer said in Brussels that nothing had changed in his country’s position on the agreement. There are still intensive discussions within the Union.
The EU Commission has been trying to find a compromise for years. She repeatedly points out that the agreement could save companies in the EU billions in tariffs and boost exports.
One thing is clear: difficult negotiations lie ahead. “No major breakthrough” can be expected at the summit, said EU foreign policy chief Josep Borrell at the beginning of the summit meeting. “But I expect the will to be expressed to continue working hard to reach an agreement by the end of the year.”
Promises such as those made by Lula, who protested in Brussels on Monday that his country would meet its climate protection commitments and stop deforesting the Amazon rainforest by 2030, are now giving hope.
Spanish Prime Minister Pedro Sánchez, who currently holds the presidency of the Council of the European Union, also expressed a quiet confidence: “We hope that we can take further steps in these six months and hopefully come to a positive conclusion during our presidency.”
Irish Prime Minister Leo Varadkar stressed that there was a prospect of a signing within the next 12 months. EU Parliament President Roberta Metsola said the European Parliament is also pushing for human rights, environmental and sustainability concerns to be protected.
support for Ukraine
In other areas, the positions are also far apart. The second day of the summit will be about support for Ukraine. Many Latin American leaders are calling for peace talks and rejecting sanctions on Russia and clear support for Ukraine. With the left-wing authoritarian states of Cuba, Venezuela and Nicaragua, Moscow also has three allies in the region who even openly support Russia.
According to Dutch Prime Minister Mark Rutte, the fact that not all countries condemn the Russian war of aggression also has something to do with the EU. The lesson is that over the past few decades, people in Europe have been “rather arrogant” in foreign policy and in dealing with others, he said on the sidelines of the summit. This applies not only to Latin America and the Caribbean, but also to Africa and parts of Asia.
“We didn’t answer the phone when they needed us. Now they feel that when we need them, they have to do exactly what we ask of them,” added Rutte. Scholz also campaigned for a partnership with the Latin American countries on an equal footing. Europe also has “something to do with regard to the colonial past”.