The European Union hopes to reach an accord with South American trade bloc Mercosur by mid-2011 as negotiators iron out details on tough issues such as farm aid and intellectual property, the EU's trade chief Karel De Gucht said yesterday (14 September).
Both sides relaunched in May talks that had been on hold for six years with the aim of creating the world's largest free-trade zone, with 750 million people and goods trade valued at 65 billion euros a year.
"These were very positive discussions, not neglecting the difficulties there are," De Gucht said after meeting with Brazilian Foreign Minister Celso Amorim and Industry Minister Miguel Jorge.
Strong opposition from European farmers, particularly in France and Ireland, is one of the main obstacles. They fear cheap imports from their South American competitors.
"We know some member states are critical about this negotiation and they've made it known. On the other hand, it's the EU Commission that negotiates," De Gucht told reporters.
Another potential stumbling bloc is South American resistance to strict rules on intellectual property.
"We would like to go very far and obviously Mercosur has a somewhat different idea," he said in reference to intellectual property rights.
Still, the overall climate has improved since talks first faltered in 2004, when all hopes were still pinned on progress in the Doha round of global trade talks.
"There is a readiness to discuss all topics and then we'll see where we get," De Gucht said before leaving for Sao Paulo and later Buenos Aires.
Stronger economic growth in Mercosur countries in recent years had made the region more attractive to Europeans, he added.
Mercosur is made up of founding members Brazil, Argentina, Uruguay and Paraguay.
Venezuela, whose application to become a Mercosur member still requires approval by the Paraguayan parliament, is participating in the talks as an observer.
Analysts said the EU would insist on a special chapter on investment safeguards to protect European interests in Venezuela, which has nationalised various industries as part of President Hugo Chavez's self-proclaimed socialist revolution.
(EURACTIV with Reuters.)