France Rejects EU-Mercosur Trade Agreement Due to Agricultural Concerns

Paris (Eurotoday) – France opposes the EU-Mercosur trade deal, citing concerns over its impact on French farmers and environmental standards.

The French finance minister Antoine Armand expressed that his government is doing everything it can to stop the adoption of a trade agreement between the European Union and four South American countries. “We are utilising all means, including institutional and voting at the European level, to ensure that the Mercosur agreement is not adopted in its current form.” France is striving to “persuade” its partners, “who sometimes hesitate,” to terminate the agreement, he said.

French farmers have opposed the trade arrangement with the Mercosur bloc, and Paris is leading the opposition against ratification of the agreement that would create the world’s largest free trade zone. France Prime Minister Michel Barnier had already informed EU chief Ursula von der Leyen that “this deal is unacceptable for France.” The trade agreement that the European Union wants to strike with the Mercosur bloc of South American nations would be “disastrous” for French farmers, Prime Minister Michel Barnier expressed.

What is the significance of the EU-Mercosur deal?

The trade agreement between the 27-country EU and the Mercosur nations—Brazil, Argentina, Paraguay, and Uruguay—has been in development for 25 years. The European Union and Mercosur states Argentina, Brazil, Paraguay, and Uruguay advanced a political understanding on 28 June 2019 for an ambitious, balanced, and comprehensive trade arrangement.

The EU is Mercosur’s number one trade and investment ally. EU exports to Mercosur were €45 billion in goods in 2021 and €17 billion in services in 2020. The EU is the largest foreign investor in Mercosur, with a stock of €330 billion in 2020. While the connection is very substantial, both exporters and potential investors face obstacles in Mercosur markets.

The purpose of the new EU-Mercosur trade deal is to improve bilateral trade and investment, lower tariff and non-tariff trade barriers, notably for small and medium-sized enterprises, develop more stable and predictable regulations for trade and investment through better and stronger rules—e.g., in the scope of intellectual property rights (including geographical indications), food safety measures, competition and good regulatory practices—and promote joint matters such as sustainable development. This includes supporting workers’ rights, fighting climate change, improving environmental protection, encouraging companies to act responsibly, and maintaining high food safety standards.