EU-Mercosur trade pact faces crunch time at key summit

DW (English)

South America's trade bloc and the EU are aiming to push through a controversial pact to create the world's biggest free-trade zone. But while Germany and Spain are in favor, strong resistance is threating to derail it.

Transcript

00:00The trade agreement has always been controversial in Europe and especially in France.

00:08French farmers have been protesting for weeks, fearing they could be overrun and undercut

00:13by agricultural imports from South America if the Mercosur deal were to be enacted.

00:18France, of course, cannot single-handedly hold the deal,

00:22but now Poland has also said it won't sign the current draft.

00:27Mercosur comprises Argentina, Bolivia, Brazil, Paraguay and Uruguay.

00:33Venezuela's membership is currently suspended.

00:36The bloc's joint economic product stands at 3 trillion US dollars.

00:40The 27 countries in the European Union add up to 18 trillion.

00:45Altogether, the Mercosur deal would impact 770 million people.

00:52The EU and the South American bloc have been talking for a quarter century.

00:57Meanwhile, China has massively increased its own trade with Mercosur.

01:02Now the pressure is on the EU to finally act.

01:05The situation is exacerbated as Donald Trump will become US president

01:09and the EU needs to strengthen its own partnerships in the face of looming US tariffs.

01:16The current draft of the EU-Mercosur deal calls for 90% of tariffs between the two sides to be dropped.

01:23That would include tariffs on agricultural products like meat and soy,

01:27but also car parts that are being sent to the EU from South America,

01:31as well as cars, machines and chemicals being sold from the EU into Mercosur.

01:37Still, among the voices protesting the deal are environmentalists.

01:42They warn that South America's industry, which is not generally seen as sustainable

01:47and puts profits over the protection of the rainforest, could be fired up.

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