EU Aims for 2023 Mercosur, Mexico Trade Deals

EU Commission President Ursula von der Leyen wants to finish trade talks with Mercosur and Mexico this year.

She made this clear in her State of the Union speech. “Smart trade creates good jobs and wealth,” she said.

Earlier this year, the EU and Mercosur resumed their trade talks. They had reached a first-stage agreement in 2019 after twenty years.

New environmental rules from the EU have slowed the talks. Argentina, Brazil, Paraguay, and Uruguay opposed these rules.

Brazil’s President Lula calls them ‘green protectionism’.

Gautier Mignot, the EU’s envoy to Mexico, also spoke recently.  The envoy said the modernization of the EU-Mexico trade deal is ongoing.

Mignot suggested a final agreement might come by the end of 2023. He also advised patience.

Background

The EU and Mercosur have been in talks for a long time. In fact, negotiations started back in the late 1990s.

The EU is a major market for Mercosur’s agricultural goods. On the flip side, the EU exports manufactured goods to Mercosur.

The first-stage agreement in 2019 was a milestone. Yet, reaching a full deal has faced many hurdles.

Environmental concerns have taken center stage recently. The EU has been pushing for sustainable trade practices.

The EU’s anti-deforestation policy is meeting resistance from the opposing side.

This has clashed with the interests of some Mercosur countries. They rely heavily on agriculture, often at an environmental cost.

Brazil, Mexico, Colombia, and 14 other nations have voiced concerns.

They sent a joint letter to EU leaders. The law, they say, is unfair and punishes them.

Enacted on June 29, the law limits imports. Seven items like palm oil and cocoa can’t come from deforested lands. Firms must prove their goods are clean.

Ten Latin American countries also signed the letter. Others like Ivory Coast and Thailand joined too.

They warn small producers may suffer. These farmers might not meet strict EU rules.

The countries are asking for changes. They want the EU to lessen the law’s harmful effects. They also suggest new guidelines.

For the full picture, see our Mercosur EU Trade Deal: Complete Guide.