00:00Musik
00:01The EU-Mercosur Partnership Agreement foresees the creation of the world's largest free trade zone.
00:20It took 25 years to reach an agreement that is now on the table for ratification.
00:26However, the process that the European Commission has put in place is being challenged by several
00:32sectors.
00:33There are also a few member states highly skeptical of the deal, like we will reveal in this EU
00:40Decoded.
00:41Mercosur is a South American trade bloc comprised of Argentina, Brazil, Paraguay and Uruguay.
00:48The agreements with the EU will create a market of 780 million consumers, representing 25
00:56percent of world trade.
00:58Many European products now pay high export tariffs to the Mercosur bloc, such as cars
01:04, wine and spirits up to 35 percent, cheese 28 percent, machinery up to 20 percent.
01:14With the deal, those tariffs will be eliminated or significantly reduced.
01:19Farmers, environmentalists, some groups in the European Parliament and a few member states
01:25oppose the deal.
01:26We will explore this later in the programme, but let's hear what some Europeans think.
01:31In fact, they are in competition with the French industry and its agriculture, with the
01:36South American agriculture industry, which produces with different norms and has a lot of
01:42lower cost.
01:43On the other hand, you can't have the sovereign food rights and on the other hand sacrifice
01:47the peasants and peasants.
01:49That it is good, because our partners on the world, with whom we always have so good
01:54trade trade in the world, the things are not so clear as before.
01:58But I think it is also geregelt, that it is, let's say, from the landwirtschaft the same
02:02concerns as we have here our landowners.
02:06Euronews reporter Peggy Corla is an expert on trade policy.
02:18To ratify this agreement, which is both commercial and political, the European Commission proposes
02:25using two different procedures.
02:27Can you explain?
02:28The whole agreement contains parts such as the political part, which have to be ratified
02:33by national and regional parliaments.
02:36It is a risky undertaking, because if the whole agreement is ratified by national parliaments,
02:42it means that some of them may oppose the text, as it happened already in the past, when national
02:48parliaments such as the Dutch one or the Austrian one opposed the agreements.
02:54So the European Commission has decided to separate the trade part, which falls under the exclusive
02:59competence of the EU, so that the Council will vote the text, the Member States voting by
03:06qualified majority, and the text will be also voted by the European Parliament by simple
03:11majority.
03:13This way the trade part has more chances to be implemented quickly.
03:17Which Member States are more sceptical of this agreement?
03:20Why is that?
03:21And how many do we need in terms of vote for this agreement to be approved and enter into
03:28force?
03:29France has long led the opposition to the agreement on the ground that it would create
03:34unfair competition to its farmers.
03:37But it may have changed today, because the European Commission has given assurances that
03:42it would strengthen controls over imports coming from Mercosur countries and their impact
03:49on the EU markets.
03:51But Poland now is stepping up against the deal.
03:56Polish Prime Minister Donald Tusk said he was opposed to the agreement.
04:01But it remains uncertain whether he is going to be able to gather a blocking minority against
04:07the deal.
04:08Because indeed, to be signed, the deal requires 15 Member States in favour of it, and a blocking
04:15minority would require 5 Member States representing 35% of the population.
04:21The agricultural sector is one of the biggest critics of the agreement, which is why the
04:26European Commission recently added safeguards.
04:30Quotas that limit the import of products considered more sensitive, such as beef, poultry, sugar,
04:37rice and honey.
04:39Increased controls that may lead to the suspension of imports of a certain product if they increase
04:44by more than 10% or prices fall by more than 10%.
04:49EU pesticide and animal welfare rules will have to be followed by Mercosur countries.
04:54A 6.3 billion euros fund to help farmers affected by market crises.
05:00I'm joined now by Karel Lano, Chief Executive of the Centre for European Policy Studies.
05:08Can the EU afford not ratify this agreement, considering that it had to make a lot of concessions
05:15in the trade deal with the US that will raise tariffs to 15%?
05:20We need to know, let's say, that the geopolitical situation since it started to negotiate 25 years
05:26ago until today has changed so much.
05:28If we go to Latin America, and we see this also for Mercosur, the most important trading partner
05:32has become China.
05:33So if we know, say, we need to be respected as a partner also, for example, with the United
05:40States, then we should respect ourselves and say we absolutely need to conclude this agreement
05:45also to become a more important trading partner for Latin America.
05:49And if we were not to do this, I mean, it will just, after this, I would say, almost scandalous
05:54EU-US agreement, just put the EU in a corner of being an unreliable partner.
06:01The partnership will also create access to the essential raw materials as an alternative
06:08to China that concentrates a lot of that production.
06:10So how significant is this for the European industry, for instance?
06:14It's, again, an opportunity for us, I mean, to reduce, I mean, drastically this huge dependence
06:21which we have from China, which was built up without us noticing it.
06:25And now we have an opportunity to say, look, we'll do it with another region.
06:28We will just reduce our huge exposure to China and to say, look, we will make sure that Brazil
06:34can, or say, Argentina or Peru can also develop their commodities or, say, their raw materials
06:41export to Europe.
06:42So in addition to MECASU, the EU has also revised an agreement with Mexico.
06:48Where should the EU look next for partners?
06:51We should, above all, as a policy, after what the US has done to us, let's say, in this trade
06:57agreement from the 18th of August, make sure that we find a group of countries which have
07:04the similar approach to trade and to the maintenance, above all, of the trading system, which we have
07:10in the post-World War II order, where we go for a system, underscored by the WTO, the World
07:16Trade Organization, where we apply these principles of most favored nation clause and where we want
07:22to have, as the EU wants, as much as possible, zero tariffs.
07:26International trade is one of the arenas in which the EU projects its political and economic
07:32model.
07:33One tout economic benefits and new markets while others warn about the risks of more concessions
07:40to multinationals, increasing risks of deforestation in Amazonia and consumer losses.
07:46Given the tariffs recently imposed by the US on the bloc, some European governments most critical
07:54of the agreement with MERCOSUL may not change their minds.
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