EU, Mercosur close to trade agreement, EU Commissioner says

European Trade Commissioner Cecilia Malmström said on Monday that the European Union (EU) and Mercosur – Argentina, Brazil, Paraguay and Uruguay – were very close to a trade agreement whereas the negotiations appeared to have stalled.

“We are very close to a deal,” the Swedish commissioner said in response to questions on the state of the talks at a conference with Bulgarian citizens in Sofia. “I think the pending problems can be settled, but I cannot give you a date,” she added. She also said the prospect of elections in Brazil was increasing the pressure.

EU-Mercosur discussions aimed at finalizing a free-trade agreement resumed last week in Asuncion and continue this week in the Paraguayan capital. Malmström said the two sides were identifying the remaining difficulties and had have made gigantic progress. One of the questions still under discussion was car imports, a key issue for the EU.

According to a European source, Brazil would agree to a significant reduction in customs tariffs on European cars provided a significant portion of their parts is manufactured in Mercosur, but this is not acceptable to the Europeans.

Ms. Malmström added that, as in all trade negotiations, there were agricultural issues to resolve.

France, Ireland and Belgium are the EU countries most worried about the potential negative effect of an agreement on their farm sector, mainly because of beef imports from Mercosur.

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