Negotiations between the European Union and Mercosur (Brazil, Argentina, Paraguay and Uruguay) have been going on for about 25 years. Today, Donald Trump’s return to the White House and his customs duties, combined with geopolitical instability, have accelerated the process: the aim is to regain in South America the ground lost to the USA, opening up a market of 780 million people. The agreement aims to eliminate duties on almost all trade goods.

After negotiations that started in the late 1990s and were interrupted in 2004 and 2012, the agreement entered its final phase. With a new ‘two instruments’ architecture to speed up the trade area, the Council authorised signature on 9 January 2026, followed by the official initialling of the package on 17 January 2026. However, the process immediately became contentious for three reasons: agricultural sensitivity (quotas and safeguards), environmental conditionality (combating deforestation) and the legal challenge by the EU Parliament to the Court of Justice.

Farmers ‘ protests in Milan and Paris denounce unfair competition: Mercosur products are cheaper thanks to less strict environmental and animal standards. The risk is the closure of many European companies. In Italy, associations such as CIA estimate 40 thousand jobs at risk and a 22 billion euro danger for the livestock sector

Market and Geopolitics: Treaty Numbers

The EU-Mercosur agreement is a ‘global barter’: Europe exports technology, while South America offers natural resources.

In the 2024-2026 version, the treaty aims to eliminate almost all duties: Mercosur will remove taxes on 91% of EU goods, favouring cars (now taxed up to 35%), machinery and chemicals, as well as wines and quality products (GIs). In contrast, theEU will remove duties on 92% of South American goods.

The most critical aspect concerns agriculture. The EU grants access to sensitive products through quotas (TRQs) and limited quotas. For example, for beef the quota is 99,000 tonnes at 7.5% duty, while for poultry it is 180,000 tonnes duty-free. Meat, sugar and honey are also protected by bilateral safeguards to intervene quickly in the event of major shocks to the domestic market.

Besides trade, the treaty has a strong geopolitical value. South America is rich in critical raw materials such as lithium, essential for batteries and the green transition. In an era of US protectionism, Europe cannot risk isolation. Without this agreement, the South American market and its resources would come under the influence of China, already very active in the area with massive investments.

Leaving Mercosur means handing over a market of nearly 300 million consumers to the influence of Beijing or other global powers. At a time when the United States chooses protectionism, Europe cannot afford to remain closed in its shell: economic isolation would lead to inevitable decline. Signing the agreement therefore means securing a place at the forefront of the geopolitical chessboard of the future, guaranteeing our companies stable supplies and new secure trade outlets.

Comparing standards: food safety and the environment

The signing of the treaty on 17 January 2026 reignited the controversy over the disparity of production standards. The European Parliament imposed a brake, asking the Court of Justice to verify the compatibility of the agreement with the EU treaties, especially for the protection of the environment and consumers. This froze the ratification process for several months.

The main gap concerns chemicals in agriculture: some 150 pesticides banned in Europe, such as fipronil or paraquat, which are dangerous to bees and human health, are legal in Mercosur. Although the treaty provides for a gradual reduction of these substances, it does not impose an immediate ban on imported goods. The‘mirror clauses‘, invoked by Italy and France to oblige foreign producers to the same European rules, appear in the text as non-sanctionable cooperation commitments.

On the sustainability front, compliance with theParis Agreement is essential: violating it can lead to the suspension of trade benefits. However, there remains the challenge of traceability in the Amazon, where the increase in beef quotas (99,000 tonnes) could encourage new grazing at the expense of forests.

On environmental and social impacts, the divide is clear: the European Commission defines the impact as ‘negligible or transformable’ and relies on instruments such as the Anti-Deforestation Regulation (EUDR, active from 30 December 2026 for large operators). In contrast, independent studies based on the GTAP-BIO model (a mathematical model used to predict how trade agreements affect the environment) estimate a real risk: agricultural expansion could cause an increase in deforestation of between 122,000 and 260,000 hectares in Mercosur countries. Without shared satellite controls and automatic sanctions, written protections risk remaining just an ethical smokescreen.

Safeguards and Green Deal: Europe’s emergency brake

The signing of 17 January 2026 in Asunción, Paraguay should not be seen as a point of arrival, but as the beginning of a new political battle for the survival of the European agricultural model. As a department, we firmly believe that global trade can no longer be disconnected from the ethical and environmental values that Europe professes. Our position on environmental reciprocity was reflected in the European Parliament’s vote on 10 February 2026, which reduced the safeguard clause from 10% to 5% . This is not just a numerical limit (if our imports exceed this threshold, we can reintroduce duties), but the instrument with which Europe can block flows if production standards do not meet our environmental standards, acting as a real emergency brake.

From an economic point of view, however, especially in the early stages, this allows Europe to act promptly, blocking flows or re-establishing duties to prevent unfair competition from crushing our producers.

We are aware that we are facing an unprecedented challenge of coherence. At a time marked by external threats to our credibility, the European Union needs to rediscover a convinced Europeanism, capable of uniting citizens and member states around a common project. For ourGreen Policies and Agricultural Developmentdepartment, the question is not ‘if’ to do this agreement, but ‘how’ to do it: we must do it well. Ratifying the EU-Mercosur agreement must be an opportunity to show ourselves to the world as the Union of the Green Deal: a power that does not choose isolation, but is open to global collaboration without ever selling out on environmental protection. We firmly believe that this is the way: a Europe that is open, courageous and, above all, consistent with its values. Only in this way can we build a future in which economic development and the protection of the planet go hand in hand.

Read also:

Mercosur agreement: now or never – E.Pinelli; L’Europeista

The EU of ‘I’d like to but I can’t’: Mercosur in court and the triumph of the populist backyard – Y .Brioschi; L’Europeista

From aluminium to zinc, all the Mercosur resources our companies need – E.Pinelli; L’Europeista