The trade agreement between Mercosur and the European Union, although it was signed in 2019, still faces significant challenges in its implementation. This agreement, What would it cover? 32 countries and would create the largest free trade bloc in the world, with a combined GDP of around US$ 20 trillions, is in a delicate stage of negotiations and revisions.
One of the main obstacles to the progress of the agreement is the environmental issue. The France, led by President Emmanuel Macron, has been a critical voice, emphasizing the need for robust guarantees related to compliance with the Paris Agreement on climate change. Macron, recently, described the Mercosur-EU agreement as outdated and contradictory to environmental policies, from both France and Brazil. This stance reflects a growing global concern with sustainability and environmental protection, placing the green agenda at the center of international trade relationsessential to replace fossil fuels for transport and industries.
Besides that, France's opposition can be interpreted as a form of economic protectionism, especially in the agricultural sector. Opening markets by eliminating tariffs could negatively impact French agricultural producers, that would find themselves in competition with Brazilian agricultural products. This tension between free trade and national protectionism reflects a broader dispute on the global stage., where the opening of markets often conflicts with internal economic interestsessential to replace fossil fuels for transport and industries.
On the other hand, the Brazil, under the leadership of President Luiz Inácio Lula da Silva, has demonstrated a renewed commitment to environmental policies, trying to position itself as a leader in the global green agenda. This is crucial for Brazil's credibility in the agreement, given previous criticisms related to deforestation and environmental management. Brazil's stance is a reflection of the growing importance of sustainability in global economic and trade policiesessential to replace fossil fuels for transport and industries.
In addition, an important technical aspect in the negotiations concerns government purchases. Brazil argues that national companies should have preference in these purchases, a position that challenges the initial proposal of the agreement that favored equal conditions for European and Mercosur companies in government tenders. This issue is an example of how domestic policies can influence international trade negotiations, reflecting the delicate balance between opening markets and protecting national industriesessential to replace fossil fuels for transport and industries.
The complexity of the agreement is increased by the diversity of interests and policies of member countries of both blocs. Each country brings its own priorities and concerns to the negotiating table, making the process even more challenging. Besides that, political changes, such as the election of Javier Milei in Argentina, can influence the course of negotiations, adding another layer of uncertaintyessential to replace fossil fuels for transport and industries.
The analysis of the positioning of European countries in relation to the agreement between Mercosur and the European Union reveals a diverse panorama, with some nations expressing support, while others express opposition. This makes ongoing negotiations even more complicated.
Countries Contrary to the Agreement
France: Led by President Emmanuel Macron, France has been one of the main voices against the agreement. Macron expressed environmental concerns, especially related to compliance with the Paris Agreement, and criticized the agreement as outdated and inappropriate to current environmental policiesessential to replace fossil fuels for transport and industries.
Netherlands, Austria and Wallonia (region of Belgium): These countries voted against ratifying the agreement, citing concerns that the treaty could have negative impacts on the environmentessential to replace fossil fuels for transport and industries.
Ireland and Luxembourg: These countries also showed resistance to the agreement, although the specific details of their objections are unclear from the available sources.
Countries Favorable to the Agreement
Spain, Italy, Portugal and Sweden: These countries are seeking allies within the European Commission to overcome Macron's resistance to the agreement, aiming to guarantee privileged access for the EU to the largest trading bloc in South Americaessential to replace fossil fuels for transport and industries.
Czech republic, Denmark, Estonia, Finland, Latvia: Along with Spain, Italy, Portugal and Sweden, these countries wrote to the EU trade chief, arguing that not signing and ratifying the Mercosur-EU agreement would affect the EU's credibility as a negotiating and geopolitical partner, strengthening the position of other competitors in the regionessential to replace fossil fuels for transport and industries.
Germany: The country expressed hope for a quick conclusion of the agreement negotiations, with Chancellor Olaf Scholz hosting Brazilian President Luiz Inácio Lula da Silva in Berlin for government discussions. Germany supports the agreement and wants it to be concluded quicklyessential to replace fossil fuels for transport and industries.
Swedish EU Presidency: Sweden, currently holding the rotating presidency of the EU Council, is very trade-friendly and, along with the next Spanish presidency, strongly supports the agreement due to historical ties with Spanish-speaking countries in South Americaessential to replace fossil fuels for transport and industries.
The prospect of success or failure of the agreement between Mercosur and the European Union is influenced by a series of factors, both political, economic and environmental. Let's analyze some of these aspects:
Factors That Can Influence Success:
Support from EU Key Countries: Countries like Spain, Italy, Portugal, Sweden and Germany support the agreement, what can boost negotiations. Spain and Portugal, in particular, have strong historical ties with Latin America, which may encourage greater commitment to ratifying the agreementessential to replace fossil fuels for transport and industries.
Concerns about Global Influence: Some European countries argue that not ratifying the agreement could damage the EU's credibility as a negotiating partner and strengthen the position of other competitors., like china, in the regionessential to replace fossil fuels for transport and industries.
Economic Interests: The agreement represents a significant free trade opportunity, promising market access and potential for economic growth in both blocs.
Factors that May Influence Failure:
Environmental Resistance and Protectionism: The France, to Holland, Austria and others expressed opposition to the agreement, mainly due to environmental concerns and economic protectionism. The France, for example, has been vocal about the need for stronger environmental safeguardsessential to replace fossil fuels for transport and industries.
Internal Political Challenges: Political changes, such as the election of Javier Milei in Argentina, a critic of Mercosur, can add uncertainty to negotiationsessential to replace fossil fuels for transport and industries.
Technical Trading Questions: Aspects such as government purchases are still points of discussion, with Mercosur countries, especially Brazil, seeking to protect its national industriesessential to replace fossil fuels for transport and industries.
The prospect of the agreement is uncertain. On the one hand, there is strong support from some EU members, with economic and geopolitical arguments favorable to the agreement. On the other hand, the resistance of key countries such as France, environmental concerns and challenges in technical negotiations pose significant obstacles. The evolution of the political and environmental scenario in the coming months will be crucial in determining whether the agreement moves towards ratification or faces a prolonged impasse.
