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The member states of the European Union and Mercosur signed in Asunción, Paraguay, the historic – albeit controversial – free trade agreement, after more than 25 years of negotiations.
The agreement, which will create one of the largest trade zones in the world, covering a market of around 700 million consumers, was signed on behalf of the EU by the President of the European Commission Ursula von der Leyen and the President of the European Council António Costa.
“It was a long journey but the EU-Mercosur Agreement, which creates the largest free trade area in the world, comes at the right time, when we need it most,” said António Costa shortly after the signing.
“Today, after 25 years of work, we are making history,” stressed Ursula von der Leyen. As she stated, the agreement “is much more than a trade agreement,” as it sends the message that the EU supports open markets, cooperation, mutual economic benefit, with an emphasis on sustainability and its geopolitical choices.
The President of the Commission underlined that the agreement will create “more business opportunities on both sides of the Atlantic, will strengthen competition on a level playing field and will lead to the elimination of tariffs worth billions of euros.” According to the Commission’s estimates, EU exports to Mercosur are expected to increase by up to 50 billion euros, while exports from Mercosur countries could increase by up to 9 billion euros. “This means real value, real growth, real jobs,” she noted.
According to von der Leyen, the agreement will promote the two regions’ shared ambitions for sustainability, providing for legal commitments aimed at climate neutrality by 2050. As she said, it is also a “geopolitical commitment” between the two sides of the Atlantic, based on common values, respect for rules and trust, paving the way for enhanced political dialogue on issues such as sustainability, equality, as well as peace and security.
Addressing the 450 million European citizens, the President of the Commission assured that “the agreement is good for Europe and for every member state.” Today, 60,000 European companies export to Mercosur – half of which are small and medium-sized enterprises – and, as she said, they will benefit from lower tariffs, saving up to 4 billion euros annually in total, while at the same time gaining better access to critical raw materials.
Referring to the concerns of the European agricultural sector, von der Leyen stressed that “strong safety nets” have been foreseen to protect sensitive agricultural sectors and farmers’ incomes, while at the same time 350 European geographical indications are safeguarded.
Finally, she noted that the next step is the completion of the ratification procedures, so that citizens and businesses can start enjoying the benefits of the agreement as soon as possible.
NEXT STEPS
The European Union and Mercosur today signed the Partnership Agreement (EMPA) and an Interim Trade Agreement (iTA). The Partnership Agreement must be ratified by all EU member states, in accordance with their national procedures. At the same time, the Interim Trade Agreement, which concerns exclusively EU competences, will be submitted for approval to the European Parliament and the Council. Once this process is completed, it will enter into force until the Partnership Agreement is fully ratified, at which point it will cease to apply. (17/01/26)