EU and Mercosur sign landmark free-trade pact after 25 years of negotiations

The European Union and the South American bloc Mercosur signed a free-trade agreement in Paraguay on Saturday, paving the way for the EU’s largest-ever trade deal after 25 years of talks. 

The transatlantic agreement will cut tariffs on a wide range of goods — from European cars, machinery, wine, and cheese to South American beef, poultry, sugar, rice, honey, and soybeans.

“In trade, more investment means new jobs and new opportunities for everyone. We have been major suppliers of goods to the European market up until now, but we want to take this business to an even higher level. We want to be producers and suppliers of the highest-quality goods that can be made,” said Brazilian President Luiz Inácio Lula da Silva.

“The EU-Mercosur Agreement sends a powerful message. It says: Welcome to the world’s biggest market and largest free-trade zone,” said European Commission President Ursula von der Leyen.

However, the deal has sparked concerns among European farmers. Critics warn that cheaper imports could undermine local agriculture and may not meet EU standards. Supporters argue the pact will boost Europe’s struggling economy and strengthen diplomatic ties with Latin America.

“The purchase price of rice is no longer competitive. Last year it was 50 cents per kilogram, today it is 25 cents. And now that the Mercosur Agreement has been signed and duty-free imports begin tomorrow, we will all go bankrupt. We are doomed,” said Menelaos Koukourdis, a Greek rice grower.

“Ministers are making decisions without any communication with us. The decisions make no sense, and the additional measures are very harsh and directly affect us,” added French farmer Adrien Minet.