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The EU is postponing the conclusion of the trade agreement with the South American Mercosur countries until January. This is reported by the German news agency dpa.
This means the EU loses an important step in its attempt to conclude new trade agreements.
On the way into Thursday’s EU summit, both the President of the European Commission, Ursula von der Leyen, and Germany’s Chancellor, Friedrich Merz, had otherwise stated that the agreement is crucial for the EU’s competitiveness in a world where the President of the United States, Donald Trump, has imposed tariffs on European goods, and China is using state subsidies to outcompete European competitors.
– We must get rid of our dependence on certain markets. That is only possible through a network of trade agreements. That is why the Mercosur agreement is central for us, said Ursula von der Leyen on her way into the meeting.
At the summit itself, however, they did not succeed in convincing enough EU leaders to achieve the necessary majority of at least 15 of the EU’s 27 member states, representing 65 percent of the EU’s population.
While angry farmers blocked large parts of the European quarter in Brussels with tractors and set off firecrackers, von der Leyen argued that the agreement would entail major benefits for the EU.
– The agreement could create a single market of 700 million consumers in like-minded countries.
– It is of enormous importance that we get the green light for the Mercosur agreement so that it can be signed this week, said von der Leyen.
Germany’s Chancellor, Friedrich Merz, described the Mercosur agreement as the “second major issue” at the summit alongside financing Ukraine in the coming two years.
– We have spent 25 years negotiating. Now it is time to conclude an agreement if Europe is to remain a credible partner in world trade, says Friedrich Merz.
France in particular has been against the agreement. On Sunday, France requested that the vote on the agreement be postponed for fear of the reaction among French farmers.
France has, among other things, received support from Italy.
The Italian Prime Minister, Georgia Meloni, is, however, ready to support the agreement if the European Commission provides more guarantees for the farmers.
On Wednesday, the Danish EU presidency had otherwise succeeded in reaching an agreement to strengthen the protection of European agriculture in the agreement.
But that was not enough to convince the skeptical countries, which also include Poland.
Italy was, however, the decisive country in terms of achieving a qualified majority for the agreement after France’s no.
It is now an open question whether the agreement will ultimately come to fruition.
The four South American countries – Argentina, Brazil, Paraguay and Uruguay – have indicated that the agreement may fall through if it is not concluded now.
The Confederation of Danish Industry describes the outcome as “a huge disappointment”, according to its head of geopolitics, Peter Thagesen.
– At a time when the United States has turned its back on free world trade, it is precisely now that we need the EU countries to stand together, show leadership and conclude Europe’s largest trade agreement ever, says Peter Thagensen in a written comment.
The Confederation of Danish Industry still hopes that the EU will succeed in concluding the agreement.
If so, it may happen with Cyprus as the country holding the EU presidency.
Cyprus will take over the EU presidency from Denmark on 1 January 2026.