An historic trade deal has been struck between the European Union and its Latin American counterpart, Mercosur, after 20 years of negotiations – an agreement in which Spain has played, and is likely to continue to play, a key role given that its former colonies across the pond are the country’s largest international commercial partners outside Europe.
The political and business alliance give both blocs access to a potential 780 million customers or over one in every 1,000 inhabitants on earth.
It will also save EU-based companies involved in exports and imports over €4 billion a year in customs tariffs, making it the biggest trade deal the EU has achieved in its entire history.
European Commission chairman Jean-Claude Juncker (pictured speaking in the European Commission building, above left) says the agreement will create ‘significant business, economic and employment opportunities’ in both territories and aid sustainable growth on the two continents.
The deal, Juncker reveals, contains ‘the highest standards in food safety and consumer protection’ as well as stringent rules covering labour relations, workers’ rights and the environment, including all the terms of the Paris Agreement on climate change.
Juncker’s tweet just before the weekend said: “Deal done! A historical moment. In the midst of international trade tensions, we are sending a strong signal that we stand for rules-based trade. Largest trade agreement EU has ever concluded. A positive outcome for the environment and consumers.”
Mercosur covers four of South America’s most developed economies – Argentina, Brazil, Paraguay and Uruguay – with whom Spain already trades although without the same level of legal and administrative openness that the deal with the EU will allow.
Given Spain’s history and language in common with three of these four – and Portugal’s with Brazil – the trade agreement is likely to make it easier for jobs to be created in the six countries and streamline immigration and company secondments, as well as allowing firms in all six to set up branches on either side of the Atlantic.
Companies in Spain and Portugal will also save a fortune on exports and imports, leading to greater profits and lower prices for consumers on the Iberian peninsula.
The long meeting in Brussels went on until 22.30 local time on Thursday, then started up again at first light on Friday morning, before Juncker tweeted its successful conclusion at 19.30 on Friday evening.
Some of the most challenging issues involved were food and labour standards for production and export of cane sugar and beef steak.
Argentine steak is already very popular in Spain, which has a number of Argentine restaurants and also serves this in mainstream eateries – and diners are likely to find it now goes down in price as the cost of transporting it to Spain becomes lower.
Talks began on a trade deal between Mercosur and the EU in April 2000, meaning their finalisation and the signing of the deal has taken 20 years, minus nine months.