EU Trade Deal with Mercosur Bloc Takes Provisional Effect

EU and Mercosur Bloc Reach Trade Deal After 25 Years of Negotiations

A trade deal between the European Union and South America’s Mercosur bloc has taken effect, creating one of the world’s largest free trade areas with a potential consumer base of over 720 million people. The agreement was signed in January and took effect on Friday after 25 years of negotiations.

The pact aims to lower tariffs and boost trade between the two regions, accounting for 30 percent of global GDP and more than 700 million consumers. Under the terms of the deal, tariffs will be eliminated on over 90 percent of bilateral trade, with European exports of cars, wine, and cheese gaining favor, while South American beef, poultry, sugar, rice, honey, and soya beans will have easier access to the EU market.

The agreement is provisionally in effect, pending a judicial review by the European Commission. If the commission rules against it, the deal will be halted. The EU’s President, Ursula von der Leyen, has welcomed the agreement, stating that it will bring benefits for EU businesses, consumers, and farmers.

Leaders of Mercosur nations Brazil, Argentina, Uruguay, and Paraguay are expected to hold a videoconference with von der Leyen on Friday to celebrate the agreement. Brazilian President Luiz Inacio Lula da Silva has also validated the deal in his country, citing it as a response to unilateral tariffs imposed by US President Donald Trump.

The new trade deal has faced opposition from farmers and environmental groups, who have expressed concerns over the potential surge of inexpensive South American imports and increased deforestation.

Source: Al Jazeera