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European Union

Brussels Offers Concessions to France to Secure Trade Deal

Strategic Insights

— 2 min read

Brussels has drawn up "political safeguards" to win Paris's backing for a trade deal with the Mercosur bloc of South American economies. The concessions address France's concerns about unfair competition from South American farm products, particularly in the beef, chicken, and sugar sectors. The deal, which combines the EU with Brazil, Argentina, Uruguay, and Paraguay, would create a shared market of 700 million consumers.

The proposed safeguards include a "political protocol" that sets limits on the volume and prices of certain imports. This move aims to placate French farmers and ease their concerns about the deal. The concessions have been welcomed by France, which had threatened to oppose the deal if its demands were not met. The agreement requires final approval from the EU's 27 member states, with a coalition of four or more states representing at least 35% of the EU's population holding significant sway.

The European Commission, which runs trade policy on behalf of the EU's member states, hopes to formally agree the deal at a summit to mark the end of the Brazilian presidency of Mercosur in December. However, additional limits on farm exports from Mercosur countries may face resistance from South American nations, which could consider it an attempt to reopen the talks.

Key Takeaways:

  • The European Commission has proposed a "political protocol" to address France's concerns about unfair competition from South American farm products.
  • The safeguards will cover the volume and prices of beef, chicken, and sugar imports, with the aim of protecting EU producers.
  • The concessions have been welcomed by France, which had threatened to oppose the deal if its demands were not met.
  • The agreement requires final approval from the EU's 27 member states, with a coalition of four or more states holding significant sway.
  • Additional limits on farm exports from Mercosur countries may face resistance from South American nations.

Statistics:

  • 700 million: number of consumers in the shared market created by the deal.
  • 35%: percentage of the EU's population that must be represented by a coalition of four or more states to block the deal.
  • 4: number of countries (France, Poland, Austria, and others) that have expressed concerns about the deal's impact on their agricultural sectors.
  • December: target date for the European Commission to formally agree the deal at a summit.

Sources:

  • Brussels has drawn up "political safeguards" to win Paris's backing for a trade deal with the Mercosur bloc of South American economies. (Financial Times)
  • The deal combines the EU with Brazil, Argentina, Uruguay, and Paraguay, creating a shared market of 700mn consumers. (Financial Times)
  • France threatened to oppose the deal if its demands were not met, citing concerns about unfair competition from South American farm products. (Financial Times)
  • The European Commission hopes to formally agree the deal at a summit to mark the end of the Brazilian presidency of Mercosur in December. (Financial Times)
  • Additional limits on farm exports from Mercosur countries may face resistance from South American nations. (Financial Times)

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