The European Union's trade chief talked up the benefits of a possible deal with Latin America's Mercosur region on Thursday (8 July), facing down strong opposition from environmentalists, farmers and lawmakers.
Addressing the European Parliament in Strasbourg, Trade Commissioner Karel De Gucht said a free-trade agreement with Mercosur, which groups Brazil, Argentina, Paraguay and Uruguay, would boost EU exports of goods and services and open new public works contracts.
The EU and Mercosur resumed talks in Buenos Aires last week after many years of deadlocked negotiations. The deal will top the agenda at the EU-Brazil summit next week in Brasilia, when European Commission President José Manuel Barroso and Herman Van Rompuy, president of the European Council, will meet Brazilian President Luiz Inácio Lula da Silva.
If an agreement can be reached – and it could take years to negotiate – it would create the world's largest bilateral free-trade zone, encompassing 750 million people and goods valued at 65 billion euros a year.
"The Commission is well aware of the sensitivity of agriculture in these negotiations and will take this element into account when negotiating," De Gucht told lawmakers, referring to the EU executive, which will lead the talks.
De Gucht said there were good early signs that Mercosur would open its markets to European exporters in the "goods, public procurement and services" sectors, and said a deal would boost exports of EU-produced wine, cheese, fruit and vegetables.
That was an attempt to answer concerns among European farmers – a very powerful lobby in the EU – and their many supporters in Parliament that a free-trade deal would hurt EU agriculture, particularly meat and poultry producers.
Beef, pork and poultry products from Mercosur would only be allowed to enter the EU if they complied with stringent legal standards and health and safety checks, De Gucht said.
"Let it be very clear there is no intention to negotiate away our health and safety requirements," he said.
Last week's Mercosur talks were disrupted by EU agriculture ministers, who protested against import restrictions on EU food products imposed by Argentina.
Farmers and environmentalists remain unconvinced, and many members of the European Parliament, which has gained extra powers since the passage of the EU's Lisbon Treaty last December and is keen to exercise them, oppose the deal.
"EU farmers and the food sector see it as a disaster for them," said Mairead McGuinness, an Irish member of parliament from the centre-right European People's Party, the largest bloc in parliament.
"There are huge environmental consequences if the deal allows an expansion of beef production in the Mercosur region," McGuinness said.
"The United States and Japan will not contemplate a trade deal with Mercosur that sacrifices its agriculture sector. It is hard to understand why the EU is prepared to do a deal," she added.
EU trade negotiators are conscious that a deal with Mercosur would give the 27-nation bloc an edge over the United States, whose attempts to tap Latin America's growing consumer market via a free trade deal have so far been frustrated.
A Mercosur pact would likely benefit agri-food giants with Latin American operations such as Cargill Inc. and Tyson Foods, while hurting small farmers and the environment, Green party lawmaker and activist Jose Bové said.
(EURACTIV with Reuters.)