The future of free trade

Major agreement with South America close to being hammered out after 26 years – major protests in Europe

The EU's major trade agreement with South America, which has been negotiated since 1999, took a giant step towards becoming a reality on Friday. A sufficient number of EU ambassadors finally backed the so-called Mercosur agreement, several news agencies report.

Strong opposition within the Union remains, led by France. The major agreement simplifies trade with countries such as Brazil, Argentina and Uruguay, and there is great concern among European farmers that imported products will take market share.

Protests took place in France, Belgium and Poland on Friday.

The EU Commission President is likely to sign the giant agreement in Paraguay on Monday. If that happens, it will be the EU's largest free trade agreement to date, creating a single market of 780 million people. 

Minister positive – coffee and wine could become cheaper

The Swedish government is positive that the EU is close to making the Mercosur agreement a reality, the major free trade agreement with South America that has been negotiated since 1999.

Minister of Foreign Trade Benjamin Dousa (M) tells TT that the Swedish pharmaceutical and automotive industries could benefit – and in stores prices could be lower for products such as coffee and wine. Less bureaucracy is another advantage.

– This opens up opportunities for small and medium-sized companies in Europe and Sweden that may have previously found it too technically complicated and did not want to bring in expensive lawyers to get help exporting to Brazil.

After enough countries say yes on Friday, an agreement can be signed at the beginning of next week. The EU Parliament still has to approve the agreement for it to become a reality.