European Union countries have supported a trade agreement with the so-called South American bloc Mercosur, paving the way for the EU to sign its largest free trade agreement next week, UNN reports with reference to Bloomberg.
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EU ambassadors backed the deal at a meeting in Brussels on Friday, despite opposition from France and a number of countries, according to people familiar with the matter. Only a qualified majority of EU member states was needed for approval.
This decision means that European Commission President Ursula von der Leyen is likely to sign the agreement in Paraguay on January 12.
The agreement, which also includes Brazil, Uruguay, and Argentina, will conclude 25 years of negotiations to eliminate tariffs and boost exports, creating an integrated market of 780 million consumers. However, the deal has proven highly controversial, especially among European farmers who are concerned about an influx of agricultural imports into the EU.
Farmers protested in central Paris ahead of the decision, while demonstrations took place on Friday in Poland. Ireland was among the countries that voted against the agreement, the publication writes.
EU leaders had hoped to sign the agreement at their summit last month, but last-minute opposition from Italy, which cast a decisive vote, scuttled the deal.
Ultimately, however, Rome supported the proposal at Friday's meeting, partly due to additional money offered by the European Commission earlier this week to farmers in the next long-term EU budget, the publication writes.
Safeguards offered to farmers also helped sway Italy. These include a commitment to launch an investigation into the possible suspension of preferential tariffs if the volume of imports from South America increases or prices fall compared to the three-year average.
After lobbying by countries such as Italy and France, as well as the European Parliament, the threshold at which this investigation will be launched has been set at 5%, compared to the last proposal of 8%.
France, which has consistently opposed the trade agreement, stating that it would harm European farmers and consumers, voted against the agreement.
"France is favorably disposed to international trade, but the EU-Mercosur agreement is an agreement from another era, which has been discussed for too long on too outdated grounds," French President Emmanuel Macron said in a post on X on Thursday evening. "It does not justify exposing sensitive and important agricultural sectors to risks to our food sovereignty."
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The EU-Mercosur trade agreement, which also needs to be approved by the European Parliament, is the largest ever concluded in Brussels. For over two decades, negotiations have been constantly suspended and resumed, as officials tried to allay concerns about environmental protection and agri-food standards for the Mercosur bloc. However, countries such as Germany and Spain strongly advocate for the agreement, which will open up new export opportunities.
According to Bloomberg estimates, the agreement will boost Mercosur's economy by up to 0.7% and Europe's economy by 0.1%. Geopolitically, it will also strengthen the EU's influence in a region where China has become a major industrial supplier and buyer of goods, the publication notes.