EU/MERCOSUR: the free trade agreement has reached the first stage!

Started in 1999 on the basis ofa previously inter-regional framework cooperation agreementsigned in December 1995, the negotiations between the two blocs were suspended in 2004 for several years and then resumed in dotted form between 2010 and 2015 (cf. Free Trade Agreements: EU negotiates all azimuts!).

In 2016, under the leadership of the European Commissioner for Trade, the negotiators of both sides formally recovered around the table forresult in agreement in principle Last June.

The commercial component of theThe EU/Mercosur Free Trade Agreement is obviously based on the principle of trade liberalization, with the mutual lowering of tariff barriers:

• Progressive abolition (within 10 to 15 years for certain sectors) of 91% of customs import duties on products of EU origin in the 4 Member States of Mercosur (Argentina, Brazil, Paraguay and Uruguay)

  Note : current tariffs in these countries are very high

  • 35% for cars
  • 18% for chemicals
  • 35% for clothing and footwear
  • 14% for pharmaceutical products
  • 27% for wine...
• In the customs territory of the European Union, 95% of customs import duties will be eliminated in return.

According to the European Commission, this agreement should allow, in the future,to European exporters to gain access to a potential 780 million inhabitants (Member States + associated countries)*) saving EUR 4 billion in customs duties.

Like the last bilateral treaties between the EU and the Japan, Vietnamor Canada, the EU/Mercosur agreement aims to be global and covers many other aspects:

• Simplification of administrative formalities and reduction of non-tariff barriers (import licences, specific marketing standards, etc.);
• Recognition of protected geographical indications : 357 European appellations will benefit from a special commercial protection status;
• Promotion of sustainable development and the implementation of the Paris Climate Agreement;
• Compliance with working conditions (ILO international conventions);
• Mutual opening of public procurement to companies from partner countries...

* The Member States of Mercosur are currently: Argentina, Brazil, Paraguay and Uruguay

Country suspended (temporarily): Venezuela

Associated countries:Bolivia (under integration), Chile, Colombia, Ecuador, Peru, Guyana and Suriname