The Council of the European Union on Friday adopted, via written procedure, two decisions authorising the signing of the EU–Mercosur Partnership Agreement (EMPA) and the Interim Trade Agreement (iTA) between the EU and the Mercosur countries- Argentina, Brazil, Paraguay and Uruguay.
Cyprus’ Minister for Energy, Commerce and Industry, Michael Damianos, described the decision as historic, noting that it comes after more than 25 years of negotiations and marks a major step towards strengthening the EU’s strategic partnership with Mercosur.
'Milestone in relations'
The agreements will create the world’s largest free trade area, encompassing a market of more than 700 million consumers. The EU is Mercosur’s second-largest trading partner, accounting for nearly 17% of the bloc’s total trade in 2024. Trade in goods between the EU and Mercosur reached €111 billion in 2024 - €55.2 billion in EU exports and €56 billion in imports - while trade in services exceeded €42 billion in 2023.
According to the Cypriot Presidency, the agreements represent a milestone in relations between the two regions, underlining their strategic importance at a time of growing global uncertainty.
Damianos said the decision reinforces political cooperation, deepens economic ties and reaffirms a shared commitment to sustainable development. He stressed that the agreements will create new opportunities for businesses on both sides, while providing robust safeguards for sensitive sectors and establishing a fair and sustainable framework for trade.
Stronger collaboration
The Council of the EU explained that the EMPA brings together political dialogue, cooperation, trade and investment into a single comprehensive framework. It strengthens collaboration in areas including sustainable development, climate and environmental protection, digital transformation, human rights, mobility, counter-terrorism and crisis management. It also enhances coordination in multilateral forums and establishes permanent mechanisms for the exchange of expertise and best practices. Under Friday’s decision, large parts of the political and cooperation chapters will be provisionally applied pending full ratification.
The Interim Trade Agreement will operate as a standalone framework until the EMPA enters fully into force. It provides for tariff reductions and improved market access in key sectors such as agriculture, automotive, pharmaceuticals and chemicals. It also facilitates investment, removes barriers to cross-border trade in services - particularly in digital and financial sectors - and allows EU companies to participate in public procurement in Mercosur countries. As the iTA falls under the EU’s exclusive competence, it does not require ratification by individual member states.
Ratification pending
Pending the adoption of a dedicated Mercosur safeguards regulation, the Council’s decision introduces temporary measures to address potential market disruptions caused by imports of sensitive agricultural products. The European Commission will be empowered to apply bilateral safeguard measures and strengthen monitoring of products subject to tariff-rate quotas, ensuring protection for EU farmers and agri-food sectors during the transition period.
Following Friday’s decisions, the EU and Mercosur will proceed with the formal signing of the agreements. European Commission President Ursula von der Leyen and European Council President António Costa are expected to travel to Paraguay to sign on behalf of the 27 EU member states.
Before the agreements can be formally concluded, the European Parliament must give its consent. The EMPA will enter into force only after ratification by all EU and Mercosur member states, while the iTA will apply provisionally until replaced by the full agreement.