The European Union has taken a major new step to get the delayed trade deal with Mercosur back on track by reaching a political agreement that strengthens protections for its agricultural sector. The informal agreement was reached this week between European Parliament and Council negotiators introduces a system of protective measures allowing the temporary suspension of tariff benefits on agricultural products imported from Argentina, Brazil, Paraguay and Uruguay if damage to European producers is found.
The decision aims to address one of the biggest internal resistances the agreement faces, particularly in countries with a heavy weight in the agricultural sector, which producers and rural organizations have been warning about for years what effects a greater openness to meat and other South American foods could have.
According to the agreed text, the European Commission can open investigations if products considered sensitive – such as beef and poultry – are imported. Increase of more than 8% compared to the average of the last three years or if prices fall in the same proportion. In both cases, these indicators are seen as signs of “serious damage” to the European market.
The regulation provides for limited deadlines: In the case of sensitive products, investigations must be completed quickly and in urgent cases Interim measures can be applied for a period of up to 21 days. In addition, the Commission will carry out constant monitoring of imports and submit semi-annual impact assessment reports to Parliament and the Council.
The agreement’s main supporters celebrated the agreement from Brussels. This was represented by the Spanish MEP Gabriel Mato The new mechanism enables progress with Mercosur “without leaving European farmers unprotected”.“, while the German Bernd Lange explained that the agreed safety net guaranteed that any market distortions would be identified and corrected in a timely manner.
Another relevant point for the Mercosur countries is the commitment of the European Commission are calling for greater harmonization of production standards for imported goodsparticularly on issues of animal welfare and the use of agrochemicals, an aspect that usually leads to trade tensions.
The provisional agreement still needs to be formally approved by the European Parliament and the Council, but the consensus reached paves the way for the signature and subsequent ratification of the treaty, planned in the coming weeks. In the context of the reorganization of world trade, the EU is trying to strengthen its relations with Mercosur, its second trading partner in goods trade, while striking a balance between trade openness and protection of its internal production framework.
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