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The European Union and South American countries are on the verge of finalizing a long-awaited trade agreement as European Commission President Ursula von der Leyen travels to Uruguay for the Mercosur summit.
Despite opposition from French President Emmanuel Macron, von der Leyen is determined to seal the deal to open new markets for European carmakers and industrial companies facing challenges from Chinese competition and potential tariffs from US President-elect Donald Trump.
The agreement with the Mercosur trade bloc, which includes Brazil, Argentina, Uruguay, Paraguay, and Bolivia, has been in negotiation for over two decades. While France opposes the deal, citing concerns about its impact on farmers and the environment, other Mercosur countries see an opportunity to expand their exports to the EU.
If finalized, the deal would create a market of 780 million people and save EU businesses over €4 billion annually in tariffs. However, political support for the agreement within Europe remains uncertain, with some member states expressing opposition.
The summit, scheduled for Thursday and Friday, is expected to be a crucial moment in the negotiation process. Brazilian President Luiz Inácio Lula da Silva and other leaders within Mercosur are keen on pushing for the deal’s announcement, even if there are doubts about its approval in Europe.
While some EU member states have voiced their support for the agreement, others like Poland and Austria have raised concerns. The final content of the deal, which includes commitments on protecting forests and fighting climate change, is still being negotiated.
Environmental organizations and farmers in Europe have already expressed their opposition to the agreement, citing concerns about environmental standards and animal welfare.
Ratification of the deal in the EU is expected to face challenges, as it requires approval from multiple member states and the European Parliament. The fate of the agreement remains uncertain as negotiations continue.
Additional reporting by Michael Pooler in Rio de Janeiro