Why has the EU negotiated a partnership agreement with Mercosur?
Mercosur is a big market for EU exports and it was until now the only major trading partner in Latin America with which the EU did not have a preferential trade agreement. EU firms exported to the four founding countries of Mercosur:
- €55 billion in goods (in 2024), and
- €29 billion in services (in 2023).
Mercosurs economies are currently highly protected and European firms face many trade barriers when exporting there, which makes it hard for them to compete under fair conditions. These include:
- high import duties
- burdensome procedures, and
- technical regulations and standards which differ from international standards.
The EU is Mercosurs second-biggest trade in goods partner, after China and ahead of the United States. The EU accounts for 16.9% of Mercosurs total trade in 2023. Mercosur is the EUs tenth-largest trade in goods partner. There is huge potential for EU firms to export even more to this large market of over 295 million people.
The EU already has trade deals in place with nearly all other countries in Latin America. Securing an agreement with the Mercosur countries allows us to further extend preferential access to EU exporters and strengthen our political ties with Latin American countries.
The EUs partnership agreement with Mercosur will:
- remove trade barriers and make it easier for EU firms to sell goods and services to Mercosur, as well as make it easier to invest;
- help secure sustainable access to raw materials, strengthening our economic security and supporting the twin transition;
- help the EU and Mercosur shape global trade rules in line with highest EU standards;
- send a powerful signal to the world in favour of rules-based trade, rejecting protectionism;
- further integrate value chains between our two regions, thereby helping industries on both sides stay competitive on the global market;
- project our values via detailed obligations on trade and sustainable development, including climate change and labour.