PARIS — After over two decades of negotiations, the European Union, comprising 27 nations, is still working towards finalizing a significant trade agreement with Mercosur, a South American trade bloc that includes Brazil, Argentina, Paraguay, Uruguay, and Bolivia. This proposed deal has faced growing protests from European farmers who are concerned about its implications.

The agreement, initially drafted in 2019, has encountered various hurdles stemming from disagreements related to environmental, economic, and political concerns, delaying its final ratification.

**What Does the Deal Entail?**

The proposed agreement aims to establish one of the largest free trade zones globally, encompassing over 700 million people and approximately 25% of the world’s GDP. Similar in nature to the U.S.-Mexico-Canada free trade agreement, its primary objective is to lower tariffs and trade barriers, thereby facilitating export activities between both regions.

For the EU, this deal would translate to decreased tariffs on products like automobiles, machinery, and chemicals. Conversely, Mercosur nations would gain enhanced access to EU markets for their agricultural exports, including beef, poultry, and sugar.

Negotiations began back in 1999, culminating in an initial agreement in 2019. However, it remains unratified due to significant pushback, especially from France.

**Why Are Farmers Concerned?**

European farmers, particularly in France, express fears that an influx of South American goods could overwhelm local markets, undermining their agricultural viability. Following a sweeping protest movement among European farmers, fresh demonstrations are emerging, with many arguing that reduced tariffs or duty-free access for South American products could jeopardize their livelihoods.

Notably, the agreement stipulates that 99,000 tons of beef would incur a reduced tariff of only 7.5%, while 180,000 tons of poultry would enter the EU duty-free. Yet, the European Commission notes this figure constitutes less than 2% of the EU’s annual beef consumption.

Livestock producers contend that competing against South American producers is challenging due to their lower labor costs, larger-scale farming operations, and fewer regulatory constraints concerning practices such as the use of growth hormones, which are banned in the EU.

A European Commission audit conducted in October revealed that Brazil, the leading global beef exporter, cannot ensure that its exports to the EU are free from the growth hormone “oestradiol 17-?,” banned in Europe for many years.

**Who Supports the Agreement?**

Countries including Germany, Spain, Italy, and Portugal are advocating strongly for the agreement to reach completion by the end of the year. In particular, Germany views Mercosur as a crucial market for its automotive sector.

In South America, leaders like Brazilian President Luiz Inácio Lula da Silva perceive the agreement as a catalyst for regional commerce and economic advancement. Nations such as Uruguay and Paraguay support it as a means to diversify their trade relationships and reduce dependency on China. Also, Argentina’s President Javier Milei has expressed support, shifting from his predecessor’s hesitance.

Industries in both regions back the deal as well, with European automotive and pharmaceutical companies eager to tap into Mercosur’s expanding markets. Ursula von der Leyen, the president of the European Commission, has called the agreement “of tremendous economic and strategic significance,” despite the resistance from certain EU member states.

**Who Opposes the Agreement?**

France, home to the largest agricultural sector in Europe, has spearheaded the opposition within the EU, joined by Poland, Austria, and the Netherlands. French President Emmanuel Macron has urged for stronger environmental and labor regulations, asserting that “France would not agree to the deal in its current form.”

France has also insisted that the European Commission renegotiate aspects of the text, especially advocating for the inclusion of “mirror clauses” aimed at imposing standardized regulations on products exchanged between the two regions.

However, France’s capacity to obstruct the deal is limited, as the authority to negotiate trade matters resides with the European Commission, which represents all 27 member nations.

Environmental organizations, including Greenpeace, have raised alarms about the potential for the deal to exacerbate deforestation in the Amazon and increase reliance on hazardous pesticides.

**What Are the Future Steps?**

The upcoming Mercosur summit, scheduled for December 5-6 in Uruguay, could signify a pivotal moment for the agreement’s future. Even if the deal is signed, it will still require ratification from all 27 EU states, the European Parliament, and the national parliaments of member states before coming into effect.

This process offers France a potential avenue to block the deal.

To facilitate and expedite the approval process, the European Commission is considering dividing the agreement into two distinct components: a broader cooperation pact and a trade-specific accord. The latter could be passed with a simple majority, thereby circumventing the need for unanimous approval.

Should this approach be adopted, France would forfeit its veto power unless it can rally sufficient support to form a blocking minority. While countries such as Poland and Austria have voiced concerns, their collective influence is not enough to meet the threshold necessary to prevent the deal from moving forward.