Farmers and politics threaten to put EU's free-trade deal with South
America on ice
[December 16, 2025] By
SAM McNEIL
BRUSSELS (AP) — France is throwing up a last-minute obstacle to a
massive trans-Atlantic trade deal between the 27-country European Union
and the five South American nations of the Mercosur bloc that’s taken a
quarter-century to negotiate.
Angry European farmers fearing new competition from the EU-Mercosur pact
are marching on Brussels, and European negotiators who thought they
would finally wrap up the deal this year are facing a tough week.
The deal between the EU and the five Mercosur countries — Brazil,
Argentina, Uruguay, Paraguay and Bolivia — would progressively remove
duties on almost all goods traded between the two blocs over the next 15
years. Provided it is ratified by both blocs, the accord would cover a
market of 780 million people and a quarter of the globe’s gross domestic
product.
Negotiators agreed on the EU-Mercosur deal a year ago, but it now must
be approved by all 27 EU countries, as well as the European Parliament.
Both the European Commission President Ursula von der Leyen and European
Council President António Costa are scheduled to sign the deal in Brazil
on Dec. 20 — if aggrieved farmers marching on Brussels and vocal
opposition from key EU nations don't derail their plans.
The deal faces headwind
In the run-up to what many expected to be the final stretch, French
Prime Minister Sébastien Lecornu said on Sunday that the current EU-Mercosur
deal was “unacceptable,” and that conditions for a vote of EU heads of
state and government on Thursday “have not been met.” He requested a
delay, which would push the vote to 2026 or beyond.
While commending recent measures taken by the European Commission to
both protect farmers and increase inspections of agricultural imports
for food safety violations like pesticides banned in the EU, Lecornu
said that France has not been fully placated.
“It is clear in this context that the conditions are not in place for
any vote by the EU Council on authorizing the signing of the agreement,”
he said.
Poland, Austria, the Netherlands and France are concerned that Mercosur
exporters could undercut EU products made with stronger labor and
sanitary regulations like pesticide restrictions, said Alicia
Gracia-Herrero, a senior fellow at the Brussels-based Bruegel Institute.
France has failed to get Mercosur to agree to “mirror” those
regulations.
She said that the deal reflects limits on the EU's geopolitical
strength, political unity and capability.
“If we cannot get this done even with (U.S. President Donald) Trump’s
pressure, what can you expect from the EU?" she said. “I hope France
cannot fully torpedo this because the EU cannot afford a further delay
in Mercosur if it wants to be credible with other ongoing trade deals,
such as Indonesia and, even more so, India.”
Another kind of trans-Atlantic pact
In the wake of Trump's tariff blitzkrieg earlier this year, when
Washington imposed levies of 15% on most imports from the EU, the bloc
has sought bilateral trade deals to help weather with aggressive trade
tactics from both the U.S. and China, its historical top trading
partners.
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 European Commission spokesperson
Olof Gill said that Brussels would push to have the Mercosur deal
signed by the end of the year because it puts the EU's geopolitical
credibility on the line.
“We’re talking about bringing together two of the world’s biggest
trading blocs. And in so doing, in a time of rising geopolitical
uncertainty, we create a platform based on trust, based on rules,
where we can work with Mercosur on the big challenges at global
level of our time. We’re talking climate, economic security, reform
of the global rules-based order, and so on,” he said.
From Spanish ham and Italian wine to Dutch dairy and Greek olives,
agriculture is central to the European Union’s budget, economy,
culture and politics. The EU exported 235.4 billion euros ($272
billion) worth of agricultural goods in 2024.
Many farmers loathe the Mercosur deal, but its proponents in
Brussels say it would save businesses some $4.26 billion in duties
each year, streamline sales, and remove tariffs on products like
French wine, Argentinian soybeans, Brazilian rare earth minerals,
and German pharmaceuticals.
Its critics in France, the Netherlands and other countries with big
dairy and beef industries say the pact would subject local farmers
to unfair competition and cause environmental damage.
Necessary or adequate adjustments
Such opposition has prompted Brussels to propose new protections for
the EU's agricultural sector.
Last year, the European Commission vowed to slash red tape for
farmers and more equitably distribute annual agricultural subsidies
of 50 billion euros ($58 billion) across bloc.
In October, the commission set up new mechanisms allowing farmers to
trigger investigations if the prices of imports from Mercosur are at
least 10% lower than the prices of the same or competing EU
products. Serious violators could get their preferential tariffs
temporarily withdrawn.
In December, the commission proposed to ratchet up border
inspections to check if imported agricultural goods were produced
with pesticides banned in the EU.
But those moves have not soothed French fears nor the anxieties of
farmers.
Agricultural unions are once again planning demonstrations in
Brussels as leaders and diplomats meet for the European Council on
Thursday.
Disgruntled farmers used tractors to paralyze many European capitals
as part of a campaign lionized by the far right in the run-up to
their successful showing in EU-wide elections in 2024. ———
Associated Press writer Sylvie Corbet contributed from Paris.
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