EU trade deal with South America’s Mercosur bloc takes provisional effect
Summary
The European Union and South America’s Mercosur trade pact has started on a provisional basis after 25 years of talks. This deal aims to reduce taxes on many goods traded between the two regions, creating one of the world’s largest free trade areas with over 700 million consumers.Key Facts
- The EU-Mercosur trade deal started provisionally on Friday.
- The agreement covers about 720 million potential consumers and a market worth $22 trillion.
- It eliminates tariffs on more than 90% of goods traded between the EU and Mercosur countries.
- The deal favors European exports like cars, wine, and cheese.
- South American exports such as beef, poultry, sugar, rice, honey, and soybeans will enter Europe more easily.
- The deal is challenged by the EU’s court because it was activated without full parliament approval.
- Brazil’s President Lula approved the deal and sees it as a move against US tariffs and in support of global cooperation (multilateralism).
- Some farmers and environmental groups oppose the deal due to fears of cheap imports and increased deforestation.
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