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The ratification of the EU-Mercosur Agreement is delayed after Germany rejected it

The entry into force of the trade agreement between the European Commission and Mercosur, which was initially scheduled for 2021, will be delayed after Germany rejected ratifying the agreement this week within the framework of the Ministers of Agriculture informal Council due to environmental reasons. The Dutch parliament also rejected the deal in June.

As a result, the ratification of the agreement -if it is ratified- will take longer than expected. The text negotiated between the European Commission and Mercosur must be approved by the Council, the European Parliament, and an important part of its content by the EU national parliaments.

The French agricultural sector and political representatives have also reiterated their rejection of the agreement on numerous occasions. Meanwhile, the Spanish government has expressed its support to the agreement reached by the European Commission and the Mercosur countries in June 2019.

The Commission still hasn't published the final document on the liberalization of trade between both parties and the elimination of tariffs, according to the last meeting of the Trade Negotiations Commission of the Secretary of State for Commerce of the Ministry of Industry in July; generating uncertainty in the sector grouped in FEPEX.

In the fruit and vegetable sector, Brazil is the only Mercosur country that has presented opportunities for the export sector, with constant growth in exports in recent years and with significant product diversification. However, this trend changed in the first half of 2020, as shipments fell by 28% in volume and 15% in value over the same period in 2019, totaling 26,150 tons and 28.8 million euro.

Garlic and onion are the main vegetables exported to Brazil. Garlic exports in the first half of the year amounted to 8,206 tons and 13.1 million euro, while onion exports totaled 890 tons and 218,062 euro. Fruit exports are led by citrus and stone fruit shipments. One of the reasons exports fell this semester was the decline in plum exports to Brazil because of the new phytosanitary requirements that the Brazilian authorities imposed as of June 1.

Spanish exports to Argentina in the first half of 2020 only reached 718 tons worth 633,725 euro, i.e. 59% and 43% less than in the same period of the previous year, respectively. 213 tons were exported to Uruguay in the first half of this year (+ 9%) for a value of 225,334 euro (+ 13%) and there were no exports to Paraguay, according to Data from the Customs and Excise Department.



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