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ECONOMY | 24-10-2022 20:56

EU ‘fully committed’ to Mercosur free-trade deal, says top official

The European Union is “fully committed” to the stalled free-trade deal with the Mercosur bloc and must move ahead before “other actors intervene,” declares EU official Josep Borrell.

The European Union's High Representative for Foreign Affairs, Josep Borrell, said Monday that the bloc he represents is "fully committed” to finalising the stalled free-trade deal with the Mercosur bloc.

Borrell, speaking during a visit to Montevideo, called on Mercosur member states and the EU to seal their agreement, cautioning that “other actors” could “intervene” if a deal isn’t reached.

"The European Union remains fully committed to this agreement," Borrell said after meeting with Uruguay President Luis Lacalle Pou on the sidelines of the IV EU Investment Forum in the Uruguayan capital.

Responding to questioning regarding the potential problems should an agreement not be finalised, Borrell said that “that will make other economic actors intervene.”

He continued: “I am thinking of other big players who are already playing a role in Uruguay's economic development. No need to mention them, you know who I am talking about.. The corridors are filling up. I think it is in the interest of the Europeans to demonstrate a greater willingness to see the agreement finally come to fruition.”

Uruguay, a Mercosur state along with Argentina, Brazil and Paraguay, is currently negotiating an independent free-trade agreement (FTA) with China despite strong opposition from Buenos Aires and Asunción. The move has strained ties within the South American bloc founded in 1991.

The head of European diplomacy said that with Spain holding the EU presidency, 2023 will be the time when "after many years of almost being finalised," the agreement will finally come to fruition. 

A free-trade deal between the two blocs has been a long held ambition on both sides of the Atlantic. After painful negotiations running decades, the outlines of a deal were finally agreed in 2019. Since then, the proposal has encountered heavy resistance, with tensions arising on trade protection and environmental issues. In recent years, France and Brazil have clashed over the conservation of the Amazon rainforest and its accelerated destruction under President Jair Bolsonaro.

"Even for the protection of ecosystems, it is better to have mutual obligations than no obligations at all. An agreement is better than no agreement," Borrell said at Monday’s press conference.

"I am a firm believer that this agreement is mutually beneficial. In all trade agreements you win and you lose: you lose in protection and you win in the market," he concluded

The EU representative reserved high praise for Uruguay’s recent issuance of a “green bond,” which links returns on capital to the country's environmental performance.

In his meeting with Lacalle Pou at the presidential residence, the European official referenced the war in Ukraine, and thanked Uruguay for its strong condemnation of the Russian invasion.

 

– TIMES/AFP

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