Doha: Top officials from the European Union and the Mercosur bloc have finalized a free trade and comprehensive partnership agreement, concluding over 25 years of negotiations. The signing ceremony took place in Asuncion, Paraguay, attended by leaders from Paraguay, Argentina, and Uruguay, alongside EU representatives including European Commission President Ursula von der Leyen and European Council President Antonio Costa.
According to Qatar News Agency, this agreement establishes one of the largest free trade zones globally, linking EU countries with Mercosur members. It covers a market exceeding 700 million people and represents about one-quarter of global GDP. The deal facilitates the gradual elimination of tariffs on more than 90% of bilateral trade, aiming to reduce trade costs and expand the flow of goods and services across various industrial and agricultural sectors.
The agreement seeks to enhance trade by lowering tariff barriers, boosting investments, and simplifying customs procedures, thereby supporting economic growth in both regions and strengthening EU-South America trade relations. Ursula von der Leyen highlighted that the agreement represents a commitment to fair trade and long-term partnerships, emphasizing the importance of open markets in addressing global economic challenges.
Mercosur, consisting of Argentina, Brazil, Paraguay, and Uruguay, anticipates Bolivia's inclusion in 2024, once its institutional integration is completed. The agreement, initially scheduled for December during the Mercosur summit in Brazil, was postponed due to internal EU disagreements and protests from farmers in several member states.
A crucial development occurred on January 9 when a qualified majority of EU countries approved moving forward with the agreement, despite opposition from France, Austria, Hungary, Ireland, and Poland, and Belgium's abstention due to internal regional disagreements. Completion of constitutional procedures, including European Parliament approval and ratification by Mercosur legislatures, is still required. The European Parliament is set to vote on January 21 on referring the agreement to the EU Court of Justice to ensure compliance with EU treaties.