EU Gives Preliminary Green Light to Mercosur Deal After 25 Years of Negotiations

On January 9, 2026, in Brussels, delegations representing the member states of the European Union granted their preliminary approval to the long-awaited trade agreement with the MERCOSUR bloc. This decision officially concludes a negotiation process that spanned more than a quarter of a century.

The agreement secured approval via a qualified majority vote. This critical step now paves the way for the formal signing ceremony, which is scheduled for January 17 in Paraguay. Ursula von der Leyen, President of the European Commission, is slated to attend the event.

Once finalized, this accord will represent the largest trade deal ever struck by MERCOSUR since its inception back in 1991. However, the journey is not over; the deal now faces final ratification by the European Parliament. Furthermore, certain provisions within the agreement will require separate approval from the national parliaments of individual EU member states.

The approval process exposed significant internal rifts within the EU. France, Poland, Austria, Ireland, and Hungary cast votes against the measure, while Belgium chose to abstain from the decision. Conversely, major economies like Germany and Spain voiced strong support, viewing the pact as a vital mechanism for diversifying trade markets amidst the current geopolitical climate.

French President Emmanuel Macron, whose nation was a staunch opponent, famously characterized the treaty as an "agreement from a different era." This sentiment resonated with ongoing farmer protests in Paris, fueled by fears of unfair competition impacting domestic agriculture.

Economically, the deal aims to forge the world's largest free trade zone, potentially encompassing approximately 700 million consumers. The agreement is projected to eliminate tariffs on 92 percent of MERCOSUR's exports, while offering preferential access to an additional 7.5 percent of goods, effectively covering 99 percent of the bloc's agribusiness exports. For European exporters, this could unlock opportunities valued at 50 billion euros by the year 2040. It is worth noting that European companies already maintain a significant presence, with roughly 30,000 firms currently operating across Latin American markets. Trade volume between the two blocs reached 111 billion euros in 2024.

To address mounting concerns from the agricultural sector, the European Commission introduced amendments in 2025. These adjustments included offering supplementary guarantees and a budgetary concession under the Common Agricultural Policy (CAP). Despite these efforts, agricultural organizations, such as COPA-COGECA, maintain that the deal remains fundamentally unbalanced. Environmental groups have also voiced sharp criticism, citing potential increases in deforestation rates and the expanded market access for pesticides, many of which are prohibited within the EU.

MERCOSUR—comprising Argentina, Brazil, Paraguay, and Uruguay (Bolivia officially joined as a full member in 2024, while Venezuela remains suspended)—views this breakthrough as opening significant new avenues, anticipating "more trade, more investment, and more employment." German Chancellor Friedrich Merz welcomed the preliminary approval but emphasized that 25 years of negotiation is far too protracted, calling for swifter resolutions in the future. From a geopolitical standpoint, Brussels' decision signals Europe’s strategic pivot toward securing new trading partners amid global instability.