EU and Mercosur: Historical Commercial deal despite resistance!

EU and Mercosur: Historical Commercial deal despite resistance!

The EU and the South American Mercosur retail block have concluded a groundbreaking free trade contract, which after more than 20 years of tough negotiations will finally become a reality! Ursula von der Leyen, President of the European Commission, announced the exciting news during a press conference in Montevideo, Uruguay. "This is a win-win agreement," she explained while performing with the President of the most important Mercosur nations, including Argentina and Brazil. This contract could create one of the largest free trade zones in the world and cover more than 700 million people and almost 25 percent of the global gross domestic product!

Not everyone is thrilled! While the South American leaders celebrated the pact, there is resistance in Europe. France leads a group of EU countries that express concerns. Minister of Commerce Sophie Primas said that the Leyen's announcement "only affects" and that the contract is far from being dry. In order to ratify the contract, the consent of 15 of the 27 EU member states and a simple majority in the European Parliament are required. The EU farmers are also skeptical and fear that products from Mercosur cannot meet the EU standards and create unfair competition.

economic opportunities and challenges

from the Leyen emphasized that the agreement will benefit around 60,000 companies that export to the Mercosur region. "We heard what our farmers say and we act accordingly," she said, adding that the agreement contains strong protective measures for European farmers. The German Chancellor Olaf Scholz celebrated the conclusion of the deal as an important step for more growth and competitiveness. "An important obstacle has been overcome," he proudly announced for social media.

The commercial and industrial associations in Germany welcomed progress, but it remains to be seen whether the skeptics in Europe can be convinced. Spain and Germany see Mercosur an opportunity to diversify their markets and to secure critical raw materials such as lithium that are essential for the green turn of Europe. While the negotiations have finally come to a conclusion, the question remains whether the approval of the EU countries can actually be secured.