As the EU looms closer to securing a free trade deal with Mercosur, France continues their years-long effort to block it. French officials are trying to convince their Polish counterparts to form a coalition to stop the deal going forward, Bloomberg reported.
The deal with Mercosur, the main South American trade bloc, has been under discussion for over twenty years. It seeks to lift barriers to create a free trading area covering a population of 780m and annual trade worth between €40 and €45b ($43 – $48b).
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The agricultural sector in France strongly opposes the deal, as they fear South American exports could provide cheaper goods to the EU market given they are not subject to the same health and environmental regulations.
Poland also has a large agricultural sector which the government has a history of protecting from foreign competition. In 2023, the previous government banned Ukrainian grain imports after a diplomatic rift.
On the other hand, Germany is a strong proponent of the deal. Facing a failing coalition and a future of higher import tariffs in the US, widening their export market would help grow the country’s sluggish economy.
The commission is considering financial compensation for French farmers to address some of their concerns. Some say this won’t be enough to appease them.
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By GlobalDataPascal Lecamp, the Deputy of the French National Assembly, explains that even with financial compensation, farmers are already dealing with the effects of bad weather and low prices.
“I love Brazil and I’m a strong advocate of free trade, but not at any cost […] No compromise is possible in the short term, unless for instance, Brazil stops using antibiotics overnight,” Lecamp told Bloomberg in an interview.
The Commission could choose to implement the deal in a provisional manner, which would allow them to avoid a ratification process that would require France and Poland’s sign-off. It could accelerate the acceptance of the deal, even if its formal finalisation stays pending. However, bypassing France’s objections in this manner would be a risky move for the EU as it could dilute trust in the bloc.
Mercosur is made up of Brazil, Argentina, Uruguay and Paraguay. The deal was delayed in 2019, when it was close to completion, mainly because of France’s objections.
