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The agreement between Mercosur and the European Union, debated for more than 20 years, was signed this Friday, the 6th. The announcement was made during a Mercosur summit meeting in Uruguay, with the presence of the European Commission, Ursula von der Leyen.
Far beyond a strictly commercial relationship, the agreement between Mercosur and the European Union also covers political and social issues. Photo: Reproduction
Experts interviewed by Terra do not hesitate to call it historic, despite having differing opinions on what the agreement could mean for the country in the short and long term.
O What is the Mercosur-EU agreement?
Far beyond a strictly commercial relationship, the agreement between Mercosur and the European Union also covers political and social issues. However, from an economic perspective, trade exchanges between the bloc’s countries are what end up attracting the most attention.
In practice, the agreement could create the “largest market in the world”, with around 700 million consumers involved, according to Igor Lucena, economist and doctor in International Relations.
ESPM International Relations professor Roberto Uebel adds that, annually, billions of dollars are transacted between the 27 countries of the European Union. This would then be the “largest agreement between blocks in the world”.
He summarizes the commercial part of the agreement as “free access”. “With a reduction in barriers, exemption from tariffs for the circulation of primary products between the countries of the two blocs, the granting of exclusive licenses for producers in the two blocs and also easier access to markets”, he states.
Uebel highlights that the agreement also addresses other points of economic governance and political issues, which involve, for example, technical-scientific exchange and cooperation between the two blocs.
What should happen after signing?
Weeks before the signing of the agreement, some European countries, notably France, began a campaign opposing the relationship. In the country presided over by Emmanuel Macron, there is fear on the part of farmers that meat coming from Mercosur, mainly from Brazil, will take over the French market.
The opposition could prove to be an obstacle even after the agreement is signed. This is because it is still necessary to go through some steps for implementation.
“We will have 3, 7 months of ratifications and it should be implemented, if there are no geopolitical problems, around the end of next year and the beginning of 2026. And it will be shaped and reorganized over a period of 10 years ”, estimates economist Igor Lucena.
Professor Roberto Uebel details the next steps: “Once signed, it does not come into force immediately. It needs to be approved by the parliaments of European countries. Around 15 parliaments need to ratify it, at least, and it needs to go through the European Parliament in Strasbourg, France, and it also needs to be ratified by the parliaments of Mercosur countries. We are practically talking about 30 parliaments that need to ratify it for it to come into force.”
Will prices rise or fall in Brazil?
Regarding the effects on prices, the experts interviewed by Terra disagree on what should happen. In the short term, both are optimistic about the agreement, but professor Roberto Uebel, from ESPM, fears that, in the long term, prices will rise in Brazilian markets. This is because the export market may become more attractive to meat producers, for example, than the domestic market.
Still, Uebel cannot be Manichaean and call the agreement negative. “My view as an economist, my training, places these reservations for the long term. For the short term, in Europe, it is already worrying, but my view as a political scientist also sees it as something positive because it is the strengthening of institutions, especially for Mercosur. It’s almost a realism of international relations”, he ponders.
Igor Lucena, on the other hand, sees with good eyes the effect that the agreement could have on car buyers here in Brazil, which would be, for him, supplied with better products, coming from Europe, and with more competitive prices.
“I think Brazilian industry will have to reinvent itself, because it will compete directly with European industry and without a minimum amount of taxes in the medium term. So, you’re going to have a pretty big change, right? They will have more technological cars, better finished and with much more attractive prices”, he says.
