Negotiations for a trade agreement between the European Union and South American Mercosur countries have gained momentum. According to European Commissioner Phil Hogan, there could even be an agreement this month. This arouses resistance from agriculture and horticulture, partly because of fears of sharp price falls and an uneven playing field.
The European Commission has been negotiating an association agreement with Brazil, Argentina, Uruguay and Paraguay: Mercosur for almost 20 years. Given the expiring term of office of the current European Commission, the urgency to reach an agreement suddenly seems high. Hogan has said there could be a deal by the end of next week.
With this treaty, the European Union wants, among other things, to improve market access for European service providers and producers, promote harmonization of standards in the field of plant and animal health and confirm agreements on climate and labor standards. However, if the deal goes through, it will also mean broader access for South America to the European market. Import tariffs for meat, sugar, wheat and ethanol, among other things, will then drop significantly.
Uneven playing field
Copa-Cogeca, the European umbrella organization for representatives of the agricultural sector, has a brief sent to European political leaders to share her concerns. The organization fears enormous losses for European farmers if the borders are opened to products from Brazil and Argentina. In addition, Copa-Cogeca sees an uneven playing field developing, as Europe places much higher demands on the agricultural sector. For example, meat production in the Mercosur countries has much lower standards when it comes to animal welfare. Many plant protection products that are banned in Europe are also permitted in South America, such as neonicotinoids.
In the letter, Copa-Cogeca emphasizes that the impending trade deal comes at a time when European farmers are already facing many uncertainties. This refers, among other things, to agricultural support from Brussels, the reform of the Common Agricultural Policy and the impending Brexit. Copa-Cogeca is afraid that the European Commission cannot resist the temptation to reach an agreement and thus makes hasty and unbalanced concessions.
Dutch politicians are also viewing this trade deal with suspicion. Various parties therefore argue for equal standards. The Party for the Animals (PvdD) is the clearest and wants to have agriculture completely removed from the agreement. Members of Parliament Helma Lodders and Wybren van Haga (VVD) already stated on June 14 Parliamentary questions about the issue.
Completely closed market
Frans van Dongen of the Central Organization for the Meat Sector (COV) calls it scandalous that Europe is about to conclude a trade deal without demanding that trade barriers, especially by Brazil, be removed. "Mercosur is a fairly interesting, but completely closed market for us. The South American countries want Europe to open the door further, but that does not happen the other way around. We are much too nice to countries like Brazil."
The COV is in principle in favor of the trade agreement, because the meat sector increasingly has to source its income outside Europe. "In the case of Mercosur, however, the treaty is completely one-sided," Van Dongen notes. "We will also speak to politicians about this." He believes there is a good chance that a deal will be reached in the short term. "I don't think we have ever been so close. Closing a deal is step 1, putting it into practice is step 2. That will probably take years."