Mercosur and the European Free Trade Association (EFTA) signed a free-trade agreement on Tuesday, opening up a market of 300 million people in what Brazil described as a “clear signal” against Washington’s protectionist policies.
The treaty covers Switzerland, Norway, Iceland and Liechtenstein on the EFTA side, and Argentina, Brazil, Uruguay, Paraguay and Bolivia for Mercosur, markets with a combined GDP of around US$4.3 trillion.
According to a joint Mercosur-EFTA statement, the deal means that over 97 percent of exports on both sides will enjoy improved market access, boosting bilateral trade.
“Today we send a clear signal that in a world marked by trade restrictions and rising protectionism, we continue to defend rules-based international trade,” declared Brazil’s Foreign Minister Mauro Vieira at a treaty signing ceremony in Rio de Janeiro.
The Mercosur-EFTA Free Trade Agreement will only take effect once it has been ratified by the parliaments of each member state in both blocs.
The joint statement said it would create new opportunities for businesses, particularly small and medium-sized enterprises. It will also provide greater market access and modernised customs procedures.
The treaty covers goods and services trade, investment, intellectual property rights, public procurement, competition, rules of origin, trade defence, sanitary and phytosanitary measures, and technical barriers to trade. It also includes legal and horizontal issues, dispute settlement, and a chapter on trade and sustainable development.
Confirmation of the agreement arrives against a backdrop of heightened trade tensions, following a series of heavy tariffs imposed by US President Donald Trump on European and Latin American goods.
Vieira also stressed that there are “excellent prospects” for concluding the European Union-Mercosur trade deal before the end of the year.
Brazil currently holds the bloc’s rotating presidency.
The European Commission launched the ratification process this month for the EU-Mercosur deal, which has been under negotiation for decades.
Talks between Mercosur and EFTA began in January 2017 and concluded in July this year. The process accelerated after both blocs announced a “political agreement” had been reached in 2019, though the final details remained in dispute.,
The pact covers a wide range of trade disciplines, from goods and intellectual property to technical barriers to trade, sanitary measures and digital services.
– TIMES/AFP/NA
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