[Salon] EU-Mercosur free trade agreement has been finally sealed



https://www.german-foreign-policy.com/news/detail/9790

EU-Mercosur free trade agreement has been finally sealed

The EU-Mercosur free trade agreement has been finally sealed after more than 25 years. The main profiteer is Germany, the main loser France. Failure of the agreement is still possible. Farmers' protests continue.

09

DEZ

2024

The main winner

The main profiteer of the free trade agreement between the EU and Mercosur, which was finally sealed last Friday with the agreement on an additional declaration, is Germany. Of the approximately 110 billion euros currently amounted to in trade between the EU and Mercosur, 24 billion euros go to the account of the Federal Republic, more than any other EU member state. The fact that the high Mercosur import tariffs of 91 percent are omitted is particularly beneficial for the three strongest sectors of German industry; their exports are currently still being slowed down by tariffs of 35 percent on cars, up to 20 percent on machines and up to 18 percent on chemicals. 1] The free trade agreement also makes it easier for German corporations, as the Federal Association of German Industry (BDI) states, to access "important raw materials such as lithium and copper", which are "essential for key industries such as electromobility and renewable energies". Individual Mercosur countries have immense stocks of them and can export them much cheaper to the EU in the future. 2] Observers estimate the savings for German companies resulting from the agreement as a whole at up to 500 million euros per year.[ 3]

The main loser

On the European side, France is the main loser of the final agreement on the agreement. Its trade volume with Mercosur currently amounts to only ten billion euros; in particular, unlike Germany, France hardly exports vehicles to the Mercosur. At the same time, the agreement increases the pressure on French agriculture, as it reduces the export of agricultural products from the Mercosur countries; in the future, for example, up to 160,000 tons of beef per year can be sold to the EU without or reduced duties.[ 4] Because less strict standards for the agribusiness apply in Mercosur, observers agree to see European farmers at a disadvantage. In addition to the French agricultural economy, this hits the Irish, Austrian and Polish industries in particular hard. In Germany, too, the Mercosur agreement further shifts the balance of power to the disadvantage of agriculture. It "is unilaterally at the expense of European farmers and weakens our farms massively in competition," according to the German Farmers' Association; the "planned mechanisms for the protection of European standards for agriculture and food production" are "completely insufficient". 5]

Sales market and raw material supplier

The free trade agreement also threatens to have serious consequences for large parts of the population of the Mercosur countries as well as for the environment and climate. By opening the Mercosur markets to the already strong industry of the EU countries, it weakens the industry there, according to a protest statement published at the end of November by 369 initiatives from Europe and Latin America.[ 6] Workers in Mercosur countries are therefore threatened by job losses and deteriorating working conditions. In addition, the agreement cements the unequal division of labour between the EU and the Global South by reducing the Mercosur states even more than before to the neocolonial dual role as markets for EU industry and as suppliers of agricultural products and mineral resources. At the same time, the agreement promotes large-scale agricultural workers in the Mercosur countries and thus disadvantages small farmers and indigenous communities, while "the export of toxic agrochemicals ... is promoted", even by "those that are prohibited in the EU". 7] Moreover, regardless of the cosmetic additional declaration, the agreement will "accelerate deforestation, exacerbate the climate crisis and further remove our regions from climate justice".

Majority uncertain

The EU-Mercosur agreement is not yet in a final dry shawls. Although the EU Commission wants to split it into two parts; the part, which includes the central trade regulations, no longer has to be adopted by consensus of all EU states – it is enough to obtain the consent of the European Parliament and, in addition, a qualified majority of the EU states, supported by at least 15 member countries and at least 65 percent of the EU population. However, this is also not guaranteed. Thus, it is conceivable that the adoption of the agreement in the European Parliament will meet with resistance, as it is viewed not only with scepticism not only by parts of the Green Group – because of the foreseeable damage to the environment and climate – but also by conservative parties close to the agricultural industry. Even the qualified majority is not yet secured. France is vigorously fighting back with regard to its agriculture; it is supported by Austria, the Netherlands and Poland. The Italian government is still hesitating. If those forces that are against the agreement prevail in Rome, a blocking minority of more than 35 percent of the EU population would be achieved. 8] However, it can be heard that the Polish government could give in after the presidential election in the summer of 2025 if it no longer needs the votes of Polish farmers.

"A major political crisis"

In addition, further peasant protests have been announced. In France on Thursday last week - at the beginning of the Mercosur summit in Uruguay, where the agreement of the South American League of States with the EU was sealed - French farmers continued their demonstrations against the free trade agreement. 9] At the same time, Belgian farmers also took to the streets.[ 10] Further protests in the Brussels EU district have been announced for today, Monday.[ 11] A decenation is not expected for the time being, at most with a small interruption during the Christmas holidays. According to the French Collectif Stop CETA-Mercosur, there is a threatening "major political crisis in the EU". 12]

More on the topic: Protests against free trade.

[1] Hendrik Kafsack: The largest free trade zone in the world. Frankfurter Allgemeine Zeitung 07.12.2024.

[2] EU-Mercosur: Trade agreement sets urgently needed growth impulse. bdi.eu 06.12.2024.

[3] Hendrik Kafsack: The largest free trade zone in the world. Frankfurter Allgemeine Zeitung 07.12.2024.

[4] Romain Geoffroy, Maxime Vaudano: L'accord de libre-échange entre l'UE et le Mercosur a été conclu: les réponses à vos questions sur son contenu et ses consequences. lemonde.fr 06.12.2024.

[5] Mercosur agreement is at the expense of agriculture. bauernverband.de 06.12.2024.

[6], [7] The EU-Mercosur trade deal must be stopped – NOW! europeantradejustice.org 26.11.2024.

[8] Romain Geoffroy, Romain Imbach, Manon Romain: Accord UE-Mercosur : quelles coalitions des pays pourraient bloquer l'adoption du traité? lemonde.fr 06.12.2024.

[9] Tom Demars-Granja, Théo Bourrieau: Mobilisation contre l'accord UE-Mercosur : La garde à vue des cinq militants de la Confédération paysanne prolongée, la porte-parole dénonce un "deux poids deux mesures".

[10] Jean-Pierre Stroobants: En Belgique, des barrages et des blocages aux frontières contre l'accord de libre-échange UE-Mercosur. lemonde.fr 05.12.2024.

[11] Eric Renette: Manifestation des agriculteurs contre le Mercosur le lundi matin à Bruxelles. lesoir.be 08.12.2024.

[12] Tom Demars-Granja, Théo Bourrieau: Mobilisation contre l'accord UE-Mercosur : La garde à vue des cinq militants de la Confédération paysanne prolongée, la porte-parole dénonce un « deux poids deux mesures ».



This archive was generated by a fusion of Pipermail (Mailman edition) and MHonArc.