Directorate-General for Trade

Mercosur

Mercosur was established in 1991 and encompasses Argentina, Brazil, Paraguay and Uruguay. Venezuela was accepted as a full member in 2006 and is currently in the process of integrating into Mercosur.

EU-Mercosur trade represents as much as EU trade with the rest of Latin America taken together. The EU is Mercosur's second largest trading partner after the US, representing 19,6% of total Mercosur trade. The EU is the largest investor in Mercosur. Mercosur ranks 8th among EU trading partners, accounting for 3% of total EU trade in 2007.

The EU is Mercosur's first market for its agricultural exports, accounting for 21,27% of total EU agricultural imports in 2007. EU goods exports to Mercosur focus largely on industrial products including machinery, transport equipment and chemicals.

The EU-Mercosur FTA

Negotiations for an inter-regional Association Agreement between the EU and the Mercosur were launched in April 2000. The agreement is based on a region-to region approach and aims to be both comprehensive and ambitious, going beyond the respective WTO obligations of both sides. No sector will be excluded from liberalisation, although product and sectoral sensitivities on both sides will be taken into account. The agreement will cover not just goods, but services, investment and government procurement markets for goods, services and works.

In line with all modern EU FTAs, the EU-Mercosur FTA aims to ensure adequate protection of intellectual property rights, effective competition policies and will include a special agreement on sanitary and phytosanitary standards. It will also establish an effective and binding dispute settlement mechanism to help resolve trade frictions in the EU-Mercosur relationship.

As of 2008, 16 negotiating rounds have been conducted. Recognising the close ties between this negotiation and any outcome of the WTO Doha Development Agenda, negotiations have only taken place at a technical level since 2004. With greater clarity on the likely result of the Doha Round it should be possible to relaunch full negotiations.