Austria rejects EU-Mercosur trade deal over Amazon fires

A key committee in Austria’s Parliament has rejected a draft free-trade pact between the European Union and the Mercosur bloc over concerns about fires in the Amazon, the latest sign of resistance to the agreement reached in June.

In a decision that’s binding for the government, almost all parties on the Parliament’s EU subcommittee voted against the deal with the Mercosur free-trade zone -- comprising Brazil, Argentina, Uruguay and Paraguay.

“The rainforest is burnt down in South America to create grazing land to then export discount beef to Europe,” Elisabeth Koestinger, a former agriculture minister of the conservative People’s Party, said in a statement after Wednesday’s vote. “The EU mustn’t reward that with a trade agreement.”

European opposition to the pact has surged over fires in the Amazon rainforest. French President Emmanuel Macron branded Brazil’s president a liar before the Group of Seven (G7) meeting last month and threatened to block the deal. Irish lawmakers in July expressed opposition over concerns about its impact on local farmers.

Austria is currently ruled by a technocrat administration pending snap elections on September 29. The country’s Parliament could still move to reverse the decision later, and the text of the draft agreement isn’t expected to be ready until at least next year.

– BLOOMBERG