It has taken 25 years for the EU and MERCOSUR to finalize what is considered one of the most ambitious trade agreements of recent times. The deal consists of an Association Agreement and an interim trade agreement aimed at establishing a free trade area between the two blocs. Argentina, Brazil, Paraguay, and Uruguay are full member states, while Colombia, Chile, Ecuador, Guyana, Panama, Peru, and Suriname participate as associated states in this pact concluded with the 27 EU member states.
When people think of MERCOSUR, they often associate it only with agricultural products and protests outside European institutions. However, it is important to clarify that this agreement goes far beyond agriculture. It includes strategic cooperation in financial investment, trade, regulatory standards, and sustainable development.
Although the agreement was formally concluded in December 2025, it was not until January 2026 that the first concrete steps toward formalization were taken through its signing. However, its definitive entry into force still depends on parliamentary ratification processes in both the EU and the South American countries involved.
On January 21, in a surprising vote on its referral to the Court of Justice of the European Union, the European Parliament — with 334 votes in favor and 324 against — managed to halt its immediate approval, creating significant uncertainty. For some observers, this reflects a lack of alignment with the European Commission and the project led by Ursula von der Leyen. The decision suspends ratification, generates political and economic tensions, and may delay its entry into force for months or even up to two years.
But to better understand what is at stake, how can MERCOSUR be explained in numbers? For the South American countries, the pact provides preferential access to a market of more than 450 million consumers, representing 15% of global GDP. The EU-MERCOSUR agreement is therefore a clear strategic move by the European Commission to diversify trade partnerships at a crucial moment in the global geopolitical landscape. It represents a liberal trade initiative in a global context marked by tariff tensions, energy dependencies, and armed conflicts, where the EU seeks to assert leadership — a leadership that some today view with skepticism.
Under the agreement, the EU will eliminate tariffs on 92% of MERCOSUR exports, equivalent to around $61 billion, and grant preferential access for an additional 7.5%, worth approximately $4.7 billion. In return,
MERCOSUR will liberalize around 91% of its imports from the EU.
However, the European agricultural sector has been among the most critical voices. Many fear that South American products such as meat, soy, and sugar could enter European markets at lower prices, putting additional pressure on small and medium-sized farmers who already face challenges linked to the Common Agricultural Policy (CAP). Likewise, in certain sensitive industrial sectors, the agreement may intensify competition and require further investment to ensure productive adaptation.
Supporters of the pact argue that, despite misinformation, the facts are clear: the EU-MERCOSUR agreement will not flood European markets with agricultural products. Regarding livestock, the additional meat quota is estimated at only 200 grams per European citizen per year — representing just 1.5% of total EU consumption. Its implementation would be gradual over six years and would still be subject to tariffs.
Concerning compliance with European hygiene, residue, and food safety legislation, the agreement establishes systematic border controls, and any non-compliant shipments would be rejected. On environmental and
climate concerns, the pact includes — for the first time — binding chapters on sustainability and climate, allowing the EU to act against illegal deforestation.
Defenders insist that this is not a blank check, but rather a rules-based framework designed to benefit both parties. In addition, safeguards approved during the European Parliament’s Strasbourg session on 10 February strengthen protection mechanisms. The Safeguards Regulation linked to the agreement lowers the activation
threshold from 10% to 5% and introduces an automatic presumption of protection when imports rise or prices fall. This allows protective measures to be triggered even before those thresholds are reached if there is a risk
of economic harm. A maximum period of 21 days is set for the implementation of provisional measures, semiannual monitoring is reinforced, and the list of sensitive products — including citrus fruits — is expanded. Controls are tightened, and greater reciprocity in sanitary and environmental standards is promoted. This safeguard clause was approved by 483 votes in favor, 102 against, and 67 abstentions, following an intense campaign by the ECR group.
If the pact ultimately fails to be adopted, in a geopolitical context that increasingly demands swift action and clear trade leadership, Europe risks losing influence in a region where China, the United States, and Russia are already strengthening their presence. The real question is not whether we trade, but under what conditions — and what the positive or negative consequences will be for our markets. Only time will tell — yet hesitation also has a cost.
By Edelmira Ferri
YEPP Secretary General
