Provisional green light from the EU to Mercosur amid controversy, anger from France

With an unexpected press point, the president ofEuropean Commission Ursula von der Leyenannounced theprovisional application dell’free trade agreement with Mercosur. A decision that came the day afterratification of the agreement da parte di Argentina e Uruguaytwo of the four member countries ofbusiness alliancesigned last January 17 in Paraguay.

In Europe, the application had been blocked by the vote ofEU Parliamentwhich had asked for a referral to the Court of Justice on its legality: a step that freezes the vote of the European Chamber for at least 18-24 months.

The political reactions to the agreement

This morning’s announcement was therefore slammed by somepolitical groups opposed to the agreementlike a “tear”, “aabuse of power“, “a damage to theEU institutions“and one”democratic forcing“.

Von der Leyen’s vision of Mercosur

“Il Mercosuris one of themore significant trade agreementsof the first half of this century. It’s a deep platformpolitical commitmentwith partners who see the world like us and who believe in openness, partnership and good faith. Partners who understand that aopen and rules-based tradeproduces positive results for everyone,” said von der Leyen when announcing theprovisional application of the EU-Mercosur agreement.

Expected benefits for Europe

“Il Mercosurembodies the spirit with which theEuropaacts on the global stage. Europe is becoming stronger and more independent: oursbusinessesi nostri workers e i nostri citizensthey will reap the benefits, and they should reap them as soon as possible. It’s aboutresiliencedi growthand of Europe shaping its own future”, added the head of the EU executive.

France’s opposition and farmers’ concerns

The decision comes despite the strongopposition from Francewho fears repercussions for their ownfarmersworried aboutcompetition from South American productsat lower prices. The presidentEmmanuel Macronhe called it “a bad surprise” resulting from a “bad approach”. For the head of the Elysée, it is “a big oneresponsibilitytowards theEuropean farmerswho have expressed concerns and towards theEuropean citizens“.

The reactions of the member states and the tractor protest

Now there is fear of a return to Piazza deitractorsmany of whom have already been mobilized in recent weeksEuropean citiesBrussels included against the agreement. THE’Italia, Germania e Spainon the other hand, expressed themselves favorably to the decision which according to them opens up great opportunitiespossibilities for businesses in un momento in cui i marketsthey are marked by uncertainty.

Powers and limitations of the provisional application

Von der Leyen recalled that theMember Statesthey had already authorized theCommissionto proceed with theprovisional applicationunderlining that the agreement can only be fully concluded after the green light fromEuropean Parliament. With the provisional application, only the parts of the agreement that fall within the provisions will come into forceexclusive competences of the EUcome la reduction of duties e l’access to markets.

Timing and economic opportunities

“L’provisional applicationwill begin on the first day of the second month following the date on which theUe e l’Uruguayverbal notes will be exchanged”, specified a Commission spokesperson, clarifying that the exchange has not yet taken place. According to the European executive, the agreement offers “countlessopportunity“, especially forsmall and medium-sized enterprises. The agreement eliminates thedutieson over 90% ofexchanges between the EU and the four Mercosur countries (Argentina, Brazil, Paraguay, Uruguay), creating one of the largestfree trade zonesin the world, which will involve more than700 million people. In the Commission’s estimates, by 2040 the agreement could generate an increase of77.6 billion euros of European GDPfrom one growth del39% of exports.

Future political challenges

The move ofCommission apre ora una fase politically sensitivein cui Bruxelleswill have to manage themtensions with member statesmore critical and with aEuropean Parliamentwhich has already shown thedesire to slow down the dossier.