Germany, Spain urge EU to back Mercosur trade pact, but France resists

Summary

• Germany and Spain support the EU-Mercosur trade pact for economic and geopolitical gains, reducing reliance on China and the US. Sanchez stated it's needed for "geo-economic and geopolitical weight".
• France opposes the deal, with Macron stating, "we are not ready", citing concerns about the impact on European farmers and a lack of aligned production standards.
• Protests against the agreement in Brussels turned violent, as farmers fear cheap imports. Safeguards are being discussed, but divisions remain among EU nations.

BRUSSELS - German Chancellor Friedrich Merz and Spanish Prime Minister Pedro Sanchez urged EU leaders on Dec 18 to back a contentious free trade pact with South American bloc Mercosur, but French Prime Minister Emmanuel Macron insisted it was still not ready.

Some 25 years in the making, a trade pact with Mercosur would ‍be the ​EU’s largest in terms of tariff cuts.

Germany, Spain and Nordic countries say it will help exports hit ‍by US tariffs and reduce dependence on China by providing access to minerals.

“This trade agreement is the first of many that must come so that Europe gains geo-economic and geopolitical ​weight at a ​time when it is being questioned by clear adversaries, such as (Russian President Vladimir) Putin, or even by traditional allies,” Mr Sanchez said.

“If the European Union wants to remain credible in global trade policy, decisions must be made now,” added Mr Merz, in Brussels for a Ukraine-focused summit.

Critics of the pact, however, fear cheap ‍commodities flooding the market to the detriment of European producers.

The summit led to an anti-deal protest by some 7,000 mostly farmers, which turned violent
early in ​the afternoon.

Belgian police fired tear gas and water cannon as ⁠some protesters hurled potatoes and rocks at police and smashed windows.

Brussels police said they had authorised a protest with 50 tractors, but 1,000 had turned up.

European Commission president Ursula von der Leyen is poised to travel to Brazil to sign the agreement concluded on 2024
with the bloc of Argentina, Brazil, Paraguay and Uruguay. 

However, she needs support from EU governments and it ​is unclear whether there will be the required majority of 15 countries representing 65 per cent of the EU’s population.

Poland and Hungary are opposed and France and Italy are nervous about the impact on ‌farmers from increased imports of beef, sugar, poultry and other products.

‘We are not ready’, says Macron

France is the EU’s largest agricultural producer.

“As we speak, we are not ready; the numbers do not add up to sign this agreement,” Macron said, adding France had been working with Poland, Belgium, Austria and Ireland to force a postponement.

In France, anger over the government’s handling of lumpy skin disease, a virus affecting cattle, has deepened farmer discontent
over issues including the EU-Mercosur deal. Farmers in south-west France have blocked highways for days.

Wary of nationwide farmer protests developing like two years ago, Paris is rushing to vaccinate cattle against lumpy skin disease, while maintaining its opposition to the EU-Mercosur agreement.

EU lawmakers and governments reached a provisional agreement on ‍Dec 17 on safeguards designed to cap imports of sensitive farm products, such as beef or sugar, and to soften opposition. The European Commission is also ​due to issue a declaration committing to ensure aligned production standards.

However, Mr said there needed to be reciprocity, so that the EU did not open up its markets to cheap imports ​of products not bound by EU regulation such as on the use of pesticides.

Some of the tractors that ‌jammed streets in Brussels’ EU quarter had banners echoing Mr Macron’s scepticism.

“Why import sugar from the other side of the world when we produce the best right here? Stop Mercosur,” read one sign. REUTERS