Brussels must still clarify the legal basis and the ratification process necessary for it to be adopted by the EU
Economy.- The president of the European Commission, Ursula von der Leyen, has closed this Friday in Montevideo the trade agreement with the Mercosur countries that the European Union has been negotiating with this region for 25 years and which is still flatly opposed by France; whose president, Emmanuel Macron, warned the day before that the pact in its current state “is unacceptable” but failed to stop Brussels.
“It is not only an economic opportunity, it is also a political necessity,” said the head of the Community Executive, in an appearance without questions alongside the president of Mercosur and Uruguayan leader, Luis Lacalle Pou, to announce the agreement that the Mercosur foreign ministers had already announced the day before with the commissioner for trade, Maros Sefcovic.
“We are breaking down barriers and allowing investments to come in, forming a market of more than 700 million consumers,” said Von der Leyen, who celebrated the “true historic milestone” of an agreement between the two regions. The new framework will allow, according to Brussels’ accounts, to save European companies some 4 billion euros in tariffs each year.
Lacalle Pou, for his part, has highlighted the importance of leaving behind a relationship that “did not generate confidence” due to the succession of disagreements and frustrated agreements in the last two decades; At the same time, he has argued that it is much more than a trade agreement.
“In a world in which knowledge doubles every three years, it is illogical that countries cannot understand each other in such a time frame,” the Uruguayan leader reasoned, after joking that he will return home “more relaxed” today and assuring that the Mercosur leaders agree, “with different concepts,” on the “significance of the day.”
While the rest of the Mercosur leaders have not yet spoken publicly, the Uruguayan has announced that Santiago Peña (Paraguay) said at the meeting that “he was not satisfied, but he was enthusiastic,” while Luis Inácio Lula da Silva (Brazil) considered it a “historic day” and Javier Milei (Argentina) pointed out the “significance and importance” of the agreement.
The trade agreement involves the gradual elimination of 91% of the tariffs applied to European quotas entering Mercosur, for example on agricultural products of interest to Spain such as olive oil, wine, fruit and vegetables and pork. In exchange, the EU will also liberalise most of the access to its market, although tariff quotas remain for particularly sensitive products.
LONG PROCESS FOR RATIFICATION
Shortly before the agreement was confirmed after more than two decades of negotiations, the community spokesman on trade matters, Olof Gill, warned in a press conference from Brussels that the agreement could not be considered signed, because what happened in Montevideo, on the margins of the Mercosur summit, is a political agreement on the texts negotiated at a technical level.
“The political agreement is only the first step in a long process, it is only the beginning,” he said, referring to the fact that a long process is now beginning, which will start with the legal examination of the texts by the legal services of the Community Executive and their translation into all the official languages of the EU. Only then will Brussels announce the legal basis it will propose for ratification both in the Council and in the European Parliament.
This is an agreement between negotiators that still needs, on the European side, to go through a ratification process that will take time and that will probably involve Brussels ‘cutting up’ the Treaty. In this way, the commercial part can be adopted by a qualified majority of the Twenty-Seven and thus avoid France being able to veto it if it does not win sufficient support to form a blocking minority. It will also have to be ratified by the European Parliament, but it will avoid ratification in the 27 national parliaments if it is confirmed that the commercial framework will be separate.
The EU and Mercosur already reached an agreement in principle like this in 2019, but in the ratification process it came up against the reservations of countries such as France and Ireland, which demanded tougher environmental safeguards and mirror clauses to avoid a disadvantage for European farmers.
These demands are what the parties have negotiated in an attached declaration that will complete the Treaty they negotiated then and which includes, according to community sources, a clause that will allow the agreement to be partially or totally suspended if one of the parties moves away from the commitments of the Paris climate agreement.
For the moment, only France has been categorical in its rejection of the new agreement despite the additional provisions negotiated, although Poland, Ireland, the Netherlands and Austria have also expressed reservations if accompanying measures are not sought to compensate for the impact on their own strategic sectors.
However, from the last meeting of EU trade ministers held last week, various European sources consulted by Europa Press indicate that, with the calculator in hand, France does not yet have enough support to have a blocking minority, although it could achieve this if it convinces Italy, which is still hesitant.
