MONTEVIDEO: The European Union and South America’s Mercosur bloc dragged a long-delayed free trade deal over the line on Friday, announcing an agreement — at least in principle — on the pact that has deeply divided nations in Europe.

In a press conference in Monte­video, European Commission Presi­dent Ursula von der Leyen and her Mercosur counterparts heralded the deal after 25 years of talks, citing the need for free trade in the face of rising protectionism globally.

“This agreement is not just an economic opportunity, it is a political necessity,” von der Leyen said.

“I know that strong winds are coming in the opposite direction, towards isolation and fragmentation, but this agreement is our near response.”

The Mercosur bloc consists of Brazil, Argentina, Uruguay and Paraguay.

European officials and proponents of the deal say that it offers a way to reduce reliance on trade with China as well as insulating EU nations from the impact of likely trade tariffs being threatened by US president-elect Donald Trump.

The trade agreement is however just the start of what could be a lengthy endgame to turn it into a reality.

It needs to be legalised, translated and then approved by member nations, and could even be blocked, with France the fiercest opponent.

France has branded it as “unacceptable”. Underscoring the obstacles it now faces, French Trade Minister Sophie Primas pledged to resist its next stages, citing environmental and farming concerns.

European farmers have repeatedly protested against an EU-Mercosur deal that they say would lead to cheap imports of South American commodities, notably beef, that do not meet the EU’s green and food safety standards.

European farm lobby Copa-Coge reiterated its opposition to the deal on Friday and called for protests in Brussels.

Italy said on Thursday there were no conditions for signing off on a deal. Poland said last week it opposed the free trade deal in its current form.

European green groups also broadly oppose the accord. Friends of the Earth calls it a “climate-wrecking” deal.

Conversely, a group of EU members including Germany and Spain say the deal is vital for the bloc as it looks to diversify its trade after the near-closure of the Russian market and discomfort about reliance on China.

“Spain will work to ensure that this agreement is approved by the majority of the (European) Council because trade openness with our Latin American sister countries will make us all more prosperous and stronger,” Spanish Prime Minister Pedro Sanchez said on X.

EU proponents of the deal see Mercosur as a market for European cars, machinery and chemicals and a potentially reliable source of critical minerals, such as battery metal lithium, required for Europe’s green transition.

They also point to agricultural benefits, given the deal offers greater access and lower tariffs for EU cheeses, ham and wine.

A short press conference in Montevideo itself underscored some of challenges. Only von der Leyen and Uruguayan President Luis Lacalle Pou spoke, with no questions taken after. The presidents of Brazil, Argentina and Paraguay sat in silence.

Published in Dawn, December 7th, 2024