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Vilified by some, defended by others and misunderstood by many, the “Mercosur Agreement” is a passionate subject these days on farms across the European Union and especially in France.
ADVERTISEMENTThe European Commission has just signed it, to the dismay of French farmers and breeders, who oppose this ambitious, complex agreement that has been under negotiation for 25 years. Our reporter Julián López travelled through the French farms and vineyards to find out that, within the powerful French agri-food sector, opinions are quite divided.The Southern Common Market – Mercosur – and the EU have agreed to trade goods applying reduced or no tariffs. If ratified, this will create a market of some 800 million people, making it one of the world’s largest free trade areas. It will eliminate more than 90% of tariffs between Brazil, Argentina, Paraguay, Uruguay and the 27 EU countries.Germany and Spain support the agreement. Italy has sent mixed signals. Poland and, in particular, France are firmly against it. Their farmers say that Mercosur producers will not be subject to European standards and labour costs, nor indeed to its strict regulation of pesticides and the use of hormones and antibiotics in animals. They also claim that the agreement undermines consumers and threatens the sustainability of EU farms.Aged 43, Pierre-Marie Delangle defines himself as a “local producer”. His farm in central France employs 6 people. He breeds chickens, sheep and around 250 dairy and beef cows. He believes that the agreement will force him to cut prices by up to 30%, thereby jeopardising his business.”There are numerous other free trade agreements under negotiation or that have already been signed between Europe and many countries: the United States, Canada, Morocco, Chile and also New Zealand. We find it aberrant that all these treaties include agricultural products, which seem to be simply used as a bargaining chip against industrial products”, explains Mr Delangle.500 kilometres to the south, the agreement is viewed very differently by Jean-Marie Fabre, Chairman of the independent winegrowers of France. His vineyard property covers 15 hectares and employs 4 people. 30% of the wine produced is exported. Reduced tariffs and open markets offer him a golden opportunity. “The Mercosur Agreement poses difficulties for other agricultural sectors, but it will allow the wine industry to zero customs duties, permitting our wines to penetrate these countries, as compared with today’s tariffs of around 27%. For the wine and spirits sector, it is an agreement that will allow us to gain market share and be competitive”, explains Mr Fabre.According to the Commission, the agreement should save EU companies more than 4 billion euros a year in tariffs. Most tariff concessions are subject to specific quotas to protect EU consumers and producers, while Mercosur countries have committed to eliminating illegal deforestation by 2030.Given China’s economic slowdown and the expected increase in US trade tariffs, Elvire Fabry, an expert on trade geopolitics at the Jacques Delors Institute, says the EU must now look for new markets for its exports and bridge its strategic gaps, especially in raw materials.”Brazil and Argentina in particular boast minerals that are very important for all the green and digital technologies towards which we have redirected investment programmes and are designing a European industrial strategy”, says Ms Fabry. “It is about preserving our access to these critical mineral mines”.The European Commission has proposed financial support for farmers negatively impacted by the EU-Mercosur trade agreement – but the safety net would only be triggered in the ‘worst-case scenario’ and the EU executive says it won’t be needed.The ball is now firmly in the hands of the Member States and the Council. The European Parliament also needs to give the final green light for actual adoption.
