EU and Mercosur run to reach an agreement to release 90% of trade

The European Union is holding elections this week-end, which will define the new composition of the European Parliament, as well as the new President of the European Commission. Meanwhile, Brazilian diplomacy is working to complete a proposal for a free trade agreement between EU and Mercosur before June, as reported by the Brazilian website Terra on May 19th. According to EUBrasil Association, there should be no obstacles to this exchange of proposals, but achieving it by mid-June would represent a major advance to the negotiations.

Caption: Marcelo Camargo/ABr

Caption: Marcelo Camargo/ABr

“The European Commission will have new commissioners and some new high level positions in November. However, the technicians who already work on these subjects will not be replaced systematically”, explains Luigi Gambardella, president of EUBrasil. “There are only a few points on which only one Mercosur country has to improve its offer to raise the whole block average, considering that the other countries in Mercosur have already tabled offers with a level above 90% of liberalisation, which is the minimum agreed with the EU”, says Gambardella.

Also interviewed by Terra, the European Trade Commissioner, Karel de Gucht, agrees that EU and Brazil will focus on the elections in the coming months (Brazilians will elect their next president in October), but also says that there is a “roadmap” to achieve.

Several analysts in the Mercosur countries have highlighted the difficulties for Argentina to liberalise more than 80% of its trade, although the country is making a “huge effort”, according to the Brazilian Chancellor in Argentina, Luiz Alberto Figueiredo.

On European side, the strongest resistance to move forward in the negotiations mainly comes from French and Irish agribusiness. Brussels-based associations for international cooperation are more optimistic. “The Brazilian agro-food sector is highly competitive and may allow a more balanced trade between both blocs. EU exports are concentrated on high added-value products like olive oil, wine, malt and other beverages. With this agreement, the EU agro-food products will also have more Brazilian and Mercosur market share”, says Gambardella.

Arnaldo Abruzzini, General Secretary of Eurochambres, a trade association formed by 20 million companies in the EU, also considers that there is a complementarity and that both blocs would benefit from the agreement. “Considering that EU recently managed to reform its common agricultural policy, I am confident that we can also move forward in our negotiations (with Mercosur)”, he says.

Source: Terra