The European Union signed a free trade agreement with Mercosur on Saturday in Paraguay. It is part of a renewed economical safety strategy to respond to fresh threats and reduce Europe's dependence on 3rd countries.
The agreement creates the world's largest free trade area of 700 million people. The European Commission estimates that EU exports to Mercosur countries can increase by up to 39 percent.
The renewed EC strategy, published in December, aims to strengthen supply chains and defence industry. It besides stresses the urgent request for cybersecurity action. As the "Rzeczpospolita" interlocutor from the European Commission said: "No 1 is economically safe today, this is the problem of the full world, this is due to the emphasis on globalisation in fresh decades, where there was no thought of the hazard that these dependencies could be exploited".
Chances and fears of Polish companies
The removal of customs barriers raises concerns for Polish agri-food producers. At the same time, industrial companies see fresh opportunities for development.
The biggest beneficiary will be the German automotive industry. Polish suppliers of parts and components for German automotive factories can benefit from this. Polish machinery, pharmaceuticals, cosmetics and environmental technologies and renewable energy sources besides have the possible for growth.
Mercosur markets are forward-looking, but hard to scope for Polish companies. Barriers are costs related to distance, regulations resulting from the protectionist policy of local governments and deficiency of support from Polish authorities.
Procedures and time limits
The agreement inactive requires formal procedures, including ratification and approval of the European Parliament. According to EU officials, the agreement can enter into force by the end of the year.
Note: This article was created utilizing Artificial Intelligence (AI).
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