The following are the details of the EU-South American Mercosur trade agreement. The European Commission is to formally propose an agreement on Wednesday for approval by the European Parliament and the associate States.
DISCOUNTS, MORE AMOUNTS FOR AGRICULTURAL PRODUCTS
Mercosur will lift duties on 91% of EU exports, including cars, from the current 35% in 15 years. The EU will gradually abolish duties on 92% of Mercosur exports over a maximum of 10 years. Mercosur will besides abolish customs duties on EU agricultural products, e.g. 17% for wine and 20–35% for spirit drinks.
For more delicate agricultural products, the EU will offer increased amounts, including 99 000 tonnes more beef, while Mercosur will grant the EU 30,000 tonnes of duty-free cheese quota. There are besides EU quotas for poultry, pigmeat, sugar, ethanol, rice, honey, maize and sweet corn and for Mercosur for powdered milk and modified milk for infants. Furthermore, the agreement recognises 350 geographical indications to prevent counterfeiting of certain conventional EU food products specified as Parmigiano Reggiano cheese.
WHAT THE FREEDOM SAY
The Commission and supporters, specified as Germany and Spain, argue that this agreement offers a solution for independency from China, especially in the case of key minerals, as well as mitigating the effects of duties imposed by US president Donald Trump.
The Commission claims that the FTA is the largest agreement always agreed in terms of tariff reductions. It abolishes EU export duties worth more than EUR 4 billion ($4.7 billion) per year and is an essential part of EU efforts to diversify its trade relations.
The EU argues that, given the modest number of commercial agreements concluded by Mercosur, the EU will have an advantage resulting from early action and notes that EU companies will be able to apply for public contracts in Mercosur under the same conditions as local suppliers, which Mercosur had not previously offered in commercial contracts. The EU besides sees Mercosur as a reliable partner, seeking to reduce dependence on China on key minerals specified as lithium utilized in batteries. The agreement will guarantee that customs duties on exports of most of these materials are abolished.
Supporters say that additional beef represents only 1.6% of beef consumption in the EU and an additional amount of 1.4% of poultry, and indicate current imports, for example 200,000 tonnes of beef per year, as evidence that Mercosur meets EU standards. There are besides possible safeguard measures to address possible marketplace distortions.
WHAT THE CRITICS SAY
Friends of the Earth identified this agreement as "a devastating climate", claiming that it would lead to increased deforestation as Mercosur countries would sale more agricultural products and natural materials, frequently from forest areas, including the Amazon, which would have tragic consequences for the environment and human rights. France, which has a large beef sector that could be jeopardised by increased imports, stated that it would only sign a free trade agreement if it "protected the interests" of French and EU agriculture. Italy and Poland besides objected. Together, these 3 countries can block the agreement.
European farmers have protested respective times, claiming that the agreement will lead to inexpensive imports of goods, especially beef, which do not meet EU environmental standards and food safety. The European Commission claims that EU standards will not be relaxed.
The agreement includes environmental commitments, including the prevention of further deforestation after 2030. However, environmental organisations say that it lacks feasible measures.
