EU set to present Mercosur trade deal for approval

A Divided House
On Wednesday, the European Commission plans to table the agreement, awaiting approval of the European Parliament and a qualified majority of EU countries; at least 15 out of 27, representing 65% of the EU's population, must also agree. Germany and Spain are major supporters of the deal, since they see it as a platform to address the tariffs levelled by U.S. President Donald Trump, who is also a global player they can dispute trade with to reduce reliance on China (especially for critical minerals).

In contrast, France is the most critical and vocal opponent, labelling the agreement as "unacceptable"; farmers and green groups all over the EU take this approach too, fearing that they will be inundated by cheap imports of South American commodities, e.g. beef, which do not meet EU environmental and food safety standards. Furthermore, the deal has been criticized as damaging to climate obligations by environmental groups, who continue to hope that the deal will be blocked by the governments of either parliament or the EU.

The Strategic Importance of the Deal
Supporters of the deal argue there are significant opportunities for European industries in Mercosur economies, such as cars, machinery, and chemicals... and with access to important minerals like lithium (that are key to Europe's green transition), it would also bring some agricultural benefits with lower tariffs for EU cheeses, wine, and ham.

The European Commission tabulated the Mercosur deal as the largest trade deal ever negotiated by Europe (in terms of tariffs), with the Commission determined to make it a strategic step in diversifying. The Commission will also present a new EU-Mexico updated agreement (which was concluded earlier in the year).