EU-CELAC meeting brings little expectations for Mercosur Free Trade Agreement

By Estudio Chaloupka

The EU-Mercosur Free Trade Agreement is a trade agreement between the European Union and the Mercado Común del Sur (Mercosur), a regional economic bloc made up of Argentina, Brazil, Paraguay, and Uruguay. The agreement was signed in principle in June 2019, but it has not yet been ratified by all parties.

The agreement is expected to boost trade between the two regions by an estimated €30 billion per year, eliminate tariffs on most goods traded between the EU and Mercosur, and include provisions on investment and services.

However, the FTA has been met with some opposition, particularly from environmental groups and farmers in Europe. Environmental groups argue that the agreement would lead to increased deforestation in the Amazon rainforest, while farmers in Europe worry that it would flood their markets with cheap agricultural products from Mercosur.

The agreement is still pending ratification by the European Parliament and the national parliaments of the EU member states. It is not yet clear when the agreement will be fully implemented.

In March negotiations were held at Buenos Aires with discussions focused on the three dimensions of sustainable development (economic, social and environmental) as a framework for deepening the bi-regional partnership. Facing the new global political and economic scene, and mindful of the strategic importance of the bi-regional relationship, both delegations agreed on the importance of intensifying the dialogue in order to finalise a mutually beneficial and balanced agreement.

Dialogue continued from July 17 to 18 during the EU-CELAC summit in Brussels that brought together leaders from the European Union, Latin America and the Caribbean, but officials from both the Mercosur and the EU stated that the situation of the free trade agreement is still unlikely to be unlocked.

Intellectual Property

The EU-Mercosur FTA could also have a significant impact on intellectual property (IP) rights in both regions. The agreement includes provisions on IP protection, such as copyright, patents, and trademarks.

On the positive side, the agreement could help to strengthen IP protection in both regions. This could benefit businesses and creators in both regions by giving them greater legal protection for their IP. For example, the agreement could make it more difficult for counterfeiters to sell fake goods in both regions.

In addition, the agreement could help to promote innovation in both regions. This is because strong IP protection can encourage businesses to invest in research and development, knowing that their IP will be protected.

There are also some potential risks associated with the agreement for IP rights. For example, the agreement could lead to a "race to the bottom" in IP protection. This is because the agreement requires both regions to adopt the lowest common denominator of IP protection. This could mean that IP rights in both regions could be weakened