The negotiations over a free trade agreement between the EU and Mercosur (Argentina, Brazil, Paraguay and Uruguay) were concluded on the 28th of June 2019. These negotiations on this historical trade agreement have been on and off during the two last decades as the impact in both regions' agricultural economies is likely to be significant. The EU is already Mercosur’s top trade partner with values of import goods at EUR 44.3bn and export goods at EUR 42bn.
The EU industrial sector is set to benefit from slashing tariffs on cars (currently at 35%), car parts (14-18%) and clothing (35%), amongst other commodities. In exchange, the EU will eliminate its current duties on 100% of industrial goods.
On the agricultural side, Mercosur will open their markets to chocolates, confectionery, wines and soft drinks. Some EU dairy products like cheese will also be subject to duty-free quotas. Overall, 91% of Mercosur imports from the EU will be liberalised. The EU will slash the current import taxes on 82% of Mercosur exports including tariff-rate quotas on meat (beef, poultry and pigmeat), sugar, ethanol, rice, honey, sweetcorn and dairy products.
Both markets are unlikely to see any sudden changes in the months to come as the agreement is still to be signed by all member countries.