Portugal at EU’s Helm: New EU Presidency Aims to Seal Mercosur and Progress with Other FTA Deals

Written by | Tuesday, January 12th, 2021

Portugal will make all efforts to conclude a free-trade agreement (FTA) between the EU and the South American trade bloc Mercosur during its six-month rotating EU presidency, which it took over from Germany on 1 January. Portuguese Minister of Foreign Affairs Augusto Santos Silva said his country needed to make progress on the deal because failure would damage the reputation of the bloc while it will also try to expand Europe’s ties with other potential trade partners. “Our credibility is at stake. It is a responsibility of Portugal to try to conclude this process and we assume this obligation,” he said with respect to the Mercosur deal, which was agreed in 2019, after two decades of talks, but has still not been finalised.
In a breakthrough against protectionism around the world, the EU agreed in June 2019 to create a free-trade area of 700 million people with Mercosur, comprising Argentina, Brazil, Paraguay, Venezuela and Uruguay. But the European Parliament and France have since led the opposition to finalizing the provisions of the treaty, arguing that Mercosur must do more to meet its climate commitments under the Paris Agreement and that Brazil is failing to combat deforestation in the Amazon, a claim that the Brazilian government has repeatedly rejected. The ratification of a trade deal between the EU and Mercosur has been held up by distrust in Europe of Brazilian President Jair Bolsonaro’s government, according to EU sources. But Santos Silva said that France and Ireland should not use the environment to deflect concerns about the scale of future meat imports into the EU, saying that European countries would benefit by being able to export more to Latin America.
Beyond the Mercosur deal, the Portuguese diplomat said “we are about to conclude” the agreement with Mexico and that “we are in a very interesting phase in relation to the modernisation of our agreement with Chile.” Santos Silva also called for “political and geopolitical results with India”, a priority partner for his country with whom he wants to speed up negotiations on the FTA that the EU started in 2007 but which have been put on hold since 2013. The minister then also pointed out that Europe “cannot ignore” the giant free trade agreement that Australia, China, Japan, New Zealand and South Korea and the ten Southeast Asian countries that make-up ASEAN reached in 2020. After six years of talks, the EU and the ASEAN group had upgraded their relations from “dialogue” to “strategic partnership” at a meeting last month, which Santos Silva wants to see as a platform for further EU-ASEAN trade talks. Meanwhile, on the ‚in principle‘ conclusion of the EU-China investment deal, Portuguese Prime Minister António Costa recently said that the EU should be an autonomous global actor and warned it would be “a terrible sign” if the bloc failed to implement the deal China in order to coordinate with the new US administration of President-elect Joe Biden.

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