After two decades of intense negotiations, with the logical ups and downs of the international political processes that both blocs went through back in 2019, the negotiation stage was closed, allowing for the conclusion of a preliminary agreement that, since the beginning of this year, has been subject to review between MERCOSUR and the EU.
The weakness of world trade and global economic activity indicates an adverse situation, which calls for a rethinking of the balance of this negotiated agreement, in view of a new global trade architecture.
It should not be overlooked that, in addition to this general context, there are new environmental demands introduced by the EU. For these reasons, we can say that we are dealing with an agreement that is essentially a "work in progress"subject to significant forces of change and challenging the adaptation of the agendas of both blocks.
It should be noted that the chapters included in the trade agreement under analysis specifically include one with detailed provisions on sustainable development; in light of the recent environmental regulations enacted by the EU, this will require further discussions with the members of MERCOSUR.
In March of this year, the EU presented MERCOSUR with an additional instrument with a series of environmental and sustainability requirements that beforehand The agreements generated resistance among Mercosur member states, who felt that they could hinder the exports of agricultural producers in the bloc. In addition, the EU highlighted its concern about the deforestation of the Amazon and, as a corollary, established restrictions on trade in the event of non-compliance with the intended environmental requirements.
In light of this situation, the members of MERCOSUR prepared a document which they presented to the EU in September of this year, to establish the basis for discussion and address environmental protection.
However, it is necessary to explore the implications and the objective of having a new topic on the table in the face of negotiations that have already been concluded, which managed to balance the offers and demands of both blocks after arduous years of work.
In summary, the question to be resolved is: Does the EU's current intention involve reopening the agreement already concluded in 2019, or is it enough to think of an additional instrument?
To answer this question, it is important to know both sides of the coin. Thus, in early October, Brasilia was the scene of a meeting between the chief negotiators of both blocs with the aim of discussing the possibility of formalizing an additional instrument that would allow both parties to sign the free trade agreement before the end of the year (1).
Faced with this scenario, there is no single intra-MERCOSUR position. On the one hand, Argentina and Brazil want to go back to the negotiated text to propose “compensations”, which would imply opening chapters already closed, while for Uruguay (2) and Paraguay this alternative generates “asymmetries and imbalances”, with the direct implication of delaying the signing of the agreement.
Later, at the informal trade ministerial meeting in Valencia, Spain, EU trade ministers and officials reviewed trade commitments with third parties. Thus, the Spanish Trade Minister, Héctor Gómez, stressed that finalizing the EU-MERCOSUR agreement "It is a priority objective for this Presidency» and that is why we work on «the additional instrument in order to lay the foundations for, definitively and after 20 years, giving a definitive push that leads to the agreement«.
For her part, the Spanish Secretary of State for Trade, Xiana Méndez, stated at the final press conference that reopening the agreement already closed in 2019 with MERCOSUR “It is a red line"and that the additional instrument that is being intensively negotiated"It aims to clarify aspects of environmental and sustainability issues, as well as the social impact of trade measures."(3).
The new demands must be analysed as a whole and put into context from the position each bloc occupies. If these EU demands fail to fit in with the spirit of the agreement already negotiated and jeopardise the balance achieved, this could become a clear obstacle to progress, or a deeper excuse to change the rules.
The agenda is open; the efforts invested during more than twenty years of negotiation must be valued in order to successfully achieve a result that benefits and satisfies the parties. This agreement must be viewed within a legal framework that allows for the reduction of costs and uncertainty in international trade and encourages the development of modern and robust value chains, among its main effects. This, in order to translate the exchange into employment and international insertion, which eliminates barriers instead of creating them.
- https://www.ambito.com/uruguay/los-negociadores-aceleran-conversaciones-acuerdo-mercosur-ue-pero-los-obstaculos-no-desaparecen-n5839466
- In an interview with the Financial Times, Paraguayan President Santiago Peña said that if the agreement is not concluded before December 6 (currently Brazil holds the Pro-Tempore Presidency of MERCOSUR and will hand it over to Paraguay on that date), the South American bloc will withdraw and begin negotiating with Asian countries.
- https://spanish-presidency.consilium.europa.eu/es/noticias/reunion-informal-ministerial-comercio-valencia-20-octubre..
Lawyer from the University of Buenos Aires (UBA). Specialization in State Law - Treasury Attorney of the Nation. Manager of Commercial Standards and Instructions of the National Commission of Foreign Trade (CNCE), a decentralized body within the Ministry of Economy. Professor of the Bachelor's Degree in International Trade, the Diploma in Customs Law and the Postgraduate Specialization in Global Business at CAECE University.
