World Economy

Supporters of EU-Mercosur Free-Trade Pact Push for Deal

Supporters of EU-Mercosur Free-Trade Pact Push for DealSupporters of EU-Mercosur Free-Trade Pact Push for Deal

Supporters of a free trade pact between the EU and the Mercosur states in South America, under negotiation for nearly 20 years, are seeking to swim against the current and secure a deal by the end of the year.

“At a moment when the Anglo-Saxon world is in retreat on both sides of the Atlantic … we should take advantage of that opportunity to reinforce cross-Atlantic ties between the EU and Latin America,” said former Spanish foreign minister Josep Pique in reference to Brexit and the election of Donald Trump as president of the United States, AFP reported.

The two events are seen as partially due to a rising tide of public opinion against free trade deals, but numerous agreements are still in the works.

With the free trade deal with Canada provisionally entering into force in September and an agreement in principle reached with Japan in July, the EU is now trying to reach a deal with the Mercosur states: Argentina, Brazil, Paraguay and Uruguay.

Given the size of the Brazilian and Argentine economies, the deal is estimated to be worth four times as much as the deal with Japan for the EU and would represent an important victory for supporters of multilateral trade deals.

Pique, speaking at a recent conference organized by the Sciences Po University in Paris, said the talks which first began 18 years ago have stalled in part due to Brazil and Argentina dragging their feet.

“But now we have a window of opportunity given the political circumstances in these two countries,” said Pique, noting that Argentina’s President Mauricio Macri and his Brazilian counterpart Michel Temer now look positively on the pact.

With elections due next year in Brazil, the push by the trade pact’s supporters recalls the efforts by those who pressed for the rapid completion of the pact with the United States before Barack Obama left the White House.

After the latest round of negotiations was completed on November 10 in Brasilia, the EU said a deal was at hand.

Holding his index finger and thumb just slightly apart, Jyrki Katainen, a EU Commission vice president, said: “We’re that close to having a new association and trade agreement between EU and Mercosur.”

The next round of negotiations is scheduled for the end of the month in Brussels.

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