EU, Mercosur Sign Trade Deal
The European Union and Mercosur on June 28 agreed to a trade deal that will eliminate most tariffs on trade between the two blocs, the European Commission said in a press release. “The agreement concluded today will cover a population of 780 million and cement the close political and economic relations between the EU and Mercosur countries,” the press release said.
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Under the deal, Mercosur, which includes Argentina, Brazil, Paraguay and Uruguay, will reduce or eliminate tariffs on EU exports of cars and car parts, machinery, chemicals, pharmaceuticals, clothing and footwear. It will also slash existing Mercosur tariffs on EU chocolates and confectionery, wines, spirits and soft drinks, and allow for duty-free access under a tariff-rate quota for EU dairy products, including cheeses, the EU said.
According to a Mercosur summary of the deal, the EU will liberalize “about 100%” of trade in industrial products, and Mercosur will liberalize 90 percent of such trade. Tariffs on 80 percent of industrial exports from Mercosur countries will immediately fall to zero, the summary said, while Mercosur’s tariffs will be liberalized over a period of 15 years. For agricultural products, the EU will liberalize trade for 99 percent of Mercosur exports, and eliminate tariffs completely on 81.7% of goods, Mercosur said.
Other portions of the agreement cover food safety, geographical indications, and environmental and labor issues, the EU said. And following a five-year transition period, companies will be able to use a system of self-certification of origin for receiving benefits under the agreement, Mercosur said.