Brussels, Belgium. The EU’s free trade deal with Mercosur countries is expected to be applied on a provisional basis as soon as March, an EU diplomat told Reuters, despite a referral to the European Court of Justice that could delay the agreement.
Provisional application linked to ratification
The EU diplomat said the EU-Mercosur agreement will be applied provisionally once the first Mercosur country has ratified it. The diplomat said that will probably be Paraguay in March.
European Parliament referral to top court
EU lawmakers referred the agreement to the European Court of Justice on Wednesday, a move that could potentially delay it by two years.
Deal signed after 25 years of negotiations
The EU signed its largest-ever trade pact with Brazil, Argentina, Paraguay and Uruguay on Saturday after 25 years of negotiations. The delay has caused concern among many businesses in Germany and among supporters including German Chancellor Friedrich Merz.
Merkel-backed push and economic arguments
Merz told delegates at the World Economic Forum in Davos that he regretted the European Parliament’s decision, saying it meant another obstacle had been erected. He said on Thursday: “But rest assured: We will not be stopped. The Mercosur deal is fair and balanced. There is no alternative to it if we want to have higher growth in Europe.”
Supporters say the deal is important to offset business lost to US tariffs and to reduce reliance on China.
French-led criticism focuses on farming
Critics, led by France, argue the agreement will increase imports of cheap beef, sugar and poultry and undercut domestic farmers.
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