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ECONOMY | 20-04-2023 17:34

EU explores options to tackle Latin America’s green deal worries

Mercosur members Argentina, Brazil, Uruguay and Paraguay have expressed concerns about the impact of the European Green Deal.

The European Union is considering how to help Latin American producers meet new rules to decarbonise the economy as the two sides seek to seal a trade agreement.

Mercosur countries — Argentina, Brazil, Uruguay and Paraguay — have expressed concerns about the impact of the European Green Deal, the EU rules to reduce CO2 emissions, once the trade deal is signed, according to an official familiar with the discussions. 

Environmental issues are stalling conclusion of the agreement, which will be the largest trade deal ever negotiated by the EU. The two sides are already discussing an annex to address some of the European concerns on deforestation in the Amazon and other issues. 

“We are looking at how we can support producers, especially small and medium-sized enterprises in Mercosur countries, to be able to meet those sustainability requirements,” the EU’s trade chief Valdis Dombrovskis told Bloomberg in an interview.

Mercosur nations fear the EU would seek to impose additional restrictions and are seeking a clear signal from the bloc that the new rules won’t impact them, said the official, who spoke on the condition of anonymity.

Both sides see the next summit between EU and Latin American and Caribbean states taking place in July as an important milestone to make progress. 

But Dombrovskis cautioned that it was important not to reopen negotiations as the text agreed between the two sides in 2019 achieved a “carefully crafted economic balance.”

“If we were now to reopen it, it may take again a long time to negotiate with an uncertain outlook,” Dombrovskis said.

by Jorge Valero, Bloomberg

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